TÜV RHEINLAND AG GROUP FIGURES EDITORIAL INFORMATION · 2020-07-12 · Siegfried Schmauder Training and Consutingl Jörg Mähler Products Since its founding in 1872, TÜV Rheinland

Clo

ser

TÜV Rheinland AG

Am Grauen Stein

51105 Cologne, Germany

www.tuv.com

EditorTÜV Rheinland AGAud FellerCommunicationAm Grauen Stein51105 Cologne, GermanyPhone +49 221 806-0Fax +49 221 806-114

Concept, design, text, and implementationKirchhoff Consult AG

PrintingDruckhaus Ley + Wiegandt,Wuppertal, Germany

This product is made of paper that was responsibly produced. The greenhouse gas emissions

that were produced in the creation of this brochure were offset by investments in the climate-

protection project »Wind Power in Yuntdag, Turkey«.

EDITORIAL INFORMATION

Image creditsMarco Moog: jacket and cover, p 2/3 (Executive Board), pp 6–22, 152; Lothar Wels: p 2/3 (potrait of Dr. Bayerlein); Corbis: p 4/5 (R. Kosecki), p 32 (ocean); Plainpicture (Johner): p 29; Getty Images (R. George): p 34; Daimler AG: p 39; TÜV Rheinland AG: pp 2/3, 24, 25, 30, 31, 33, 37, 47, 52, 71.

India is a land of contrasts. One of the most interesting future markets

is opening for TÜV Rheinland here – a place where high tech and tradition,

evolution and devolution meet with unprecedented intensity.

TÜV RHEINLAND AG GROUP FIGURES

in € millions 2008 2009 2010 2011 2012

Revenues

Industrial Services 315 322 377 453 488

Mobility 289 295 311 336 366

Products 241 301 350 372 396

Life Care 59 64 55 51 55

Training and Consulting 139 150 160 160 194

Systems 117 116 123 127 118

Figures, consolidated (according to IFRS)Total Revenues 1,100 1,181 1,303 1,417 1,531Germany 662 689 713 734 756Foreign 438 492 590 683 775Earnings before interest and taxes (EBIT) (in € millions) 91.4 91.9 112.1 124.0 113.2

Profit margin (in %) 8.3 7.8 8.6 8.8 7.4

Net capital expenditure (in € millions) 71.8 66.5 78.9 87.7 83.2

Cash flow (in € millions) 77.8 77.8 100.1 112.3 108.0

Equity capital (in € millions) 214.4 236.2 288.6 325.3 291.8

Equity ratio (in %) 19.0 19.7 22.2 24.1 20.1Staff (annual average) 12,987 13,804 14,412 15,961 17,218Germany 6,382 6,753 6,766 6,774 7,035Abroad 6,605 7,051 7,646 9,187 10,183Print compensated

Id-No. 1327454www.bvdm-online.de

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rate

Rep

ort

2012

Clo

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TÜV Rheinland AG

Am Grauen Stein


www.tuv.com













in € millions 2008 2009 2010 2011 2012

Revenues


Mobility 289 295 311 336 366

Products 241 301 350 372 396

Life Care 59 64 55 51 55


Systems 117 116 123 127 118


Profit margin (in %) 8.3 7.8 8.6 8.8 7.4






Co

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rate

Rep

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2012

Responsibility

40 CSR Report

142 Verification Statement

144 About this Report

145 GRI Index

Closer

6 Visual Essay

22 Reports

TÜV Rheinland

3 Foreword by the

Chief Executive Officer

4 Foreword by the

Supervisory Board

Chairmann

Financial Report

73 Detailed Index

74 Group Management

Report

98 Consolidated

Financial Statements

140 Audit Opinion

Service

141 Corporate Bodies

152 Group Structure

Contact

Imprint

By intelligently combining organic growth and acquisitions, we are consolidating our position as the »most international« TÜV and, in doing so, are strengthening the relationships with our globally active customers. Pages 22– 27

As a consumer protection authority, we advocate quality and transparency in the global world of products and services. With our new test mark, we strengthen the confi dence of users in our services. Pages 28–33

We are meeting the major technological challenges of our time with expertise and innovative spirit and, in doing so, secure the sustainability of companies and society. Pages 34 – 39

The Group Executive Council is TÜV Rheinland AG’s highest operational management team be-low the Executive Board. It is composed of TÜV Rheinland AG’s Executive Board, Executive Vice Presidents, Chief Regional Officers, and the Heads of German Operations.

The TÜV Rheinland Group comprises more than 120 companies. The operational parent company is TÜV Rheinland, the shares of which are en-tirely in the possession of TÜV Rheinland Berlin Brandenburg Pfalz e. V.

In accordance with Germany’s Work Constitu-tion Act, the employees are represented by staff representatives on the Supervisory and Manage-ment Boards.

152

BUSINESS STREAMS AND REGIONS

Prof. Dr. Ralf Wilde

Products

Ulrich Fietz

Life Care

Industrial Services

Dr. Hans Berg Dr. Thomas Aubel

Mobility

Siegfried Schmauder

Training and Consulting

Michael Weppler

Systems

Industrial Services

Stephan Frense Prof. Dr. Jürgen Brauckmann

Mobility

Volker Klosowski

Systems

EXECUTIVE VICE PRESIDENTS HEADS OF GERMAN OPERATIONS

India, Middle East, Africa

Andreas Höfer

Antonio Carlos Caio da Silva

South America

Gerhard Lübken

North America

Western Europe

Dr. Manfred Doerges

Asia Pacific

Michael JungnitschPetr Lahner

Central Eastern Europe

Ralf Scheller

Greater China

CHIEF REGIONAL OFFICERS

A matrix organization is implemented

at TÜV Rheinland:

The Executive Vice Presidents are responsible for the global strategic alignment of their respective Business Streams, run global and transnational business developments, and exercise executive authority over quality, products, innovations, and processes. The Chief Regional Offi cers are responsible for business operations in their re-spective regions and ensure quality in sales, production, and service. The Heads of German Operations are in charge of business operations and quality assurance for business units in Ger-many. All three levels jointly prepare the content of important Executive Board decisions.

Siegfried Schmauder


Jörg Mähler

Products

Since its founding in 1872, TÜV Rheinland has developed from a regional testing agency to a leading international provider of testing, inspection, and certifi cation services that is trusted by people and companies around the world. With new ideas, expertise, and a global network, we lend a hand in making products, services, systems, and people safer and more competitive. We support, develop, promote, test, and certify. In this way, we help to build a future that does lasting justice to the requirements of humankind and the environment.

� Pressure Equipment and

Materials Technology

� Elevator, Conveyor, and

Machine Technology

� Electrical Engineering and

Building Technology

� Supply Chain & Integrity

Services

� Civil Engineering

� Energy and Environment

� Project Management and

Supervision

INDUSTRIAL SERVICES

� Occupational Health and

Safety

� Health and Supply

Management

� Medical Center Services

LIFE CARE

� Certification of

Management Systems

� Customized Services

SYSTEMS

� Professional Training

� Schools

� Personnel Certification

� Personnel Management

� Business Consulting

� Publishing and Media

� R & D and Innovation

Management

� Information Security

TRAINING UND CONSULTING

� Softlines

� Hardlines

� Electrical

� Commercial

� Medical

� Solar/Fuel Cell Technology

� Food

PRODUCTS

� Periodical Technical

Inspection

� Driver’s License

� Car Services and Appraisal

� Engineering/Type Approval

� Rail

� Intelligent Transport

Systems

� Aviation

� Maritime

MOBILITY

We are convinced that business success is a question of closeness and proximity.

Being closer means understanding: we recognize the needs of our customers and society early on and satisfy them with fi rst-class solutions. Being closer means being present: we are in the place where we are needed – at all times and in all cases. Being closer means providing support: we are actively committed to achieving a common goal. And last but not least, being closer means trusting: as a neutral, fi nancially independent company, we are extremely reliable.

Living this proximity in all its facets will bring us closer to our ambitious corporate goal: becoming the best sustainable, self-fi nanced, and independent provider of testing, inspection, and certifi cation services in the world.

Closer

TÜV RHEINLAND PROFILE

CLOSER



Products

Ulrich Fietz

Life Care

Industrial Services


Mobility

Siegfried Schmauder


Michael Weppler

Systems

Industrial Services


Mobility

Volker Klosowski

Systems



Andreas Höfer


South America

Gerhard Lübken

North America

Western Europe

Dr. Manfred Doerges

Asia Pacific



Ralf Scheller

Greater China



at TÜV Rheinland:


Siegfried Schmauder


Jörg Mähler

Products





Machine Technology


Building Technology


Services




Supervision

INDUSTRIAL SERVICES


Safety


Management


LIFE CARE


Management Systems


SYSTEMS


� Schools






Management



� Softlines

� Hardlines

� Electrical

� Commercial

� Medical


� Food

PRODUCTS


Inspection




� Rail


Systems

� Aviation

� Maritime

MOBILITY




Closer


CLOSER

2

TÜV Rheinland Corporate Report 2012

151

Responsibility

GRI Index

In 2012, approximately 2,000 of our 17,218 global employees

were employed at our headquarters in Cologne.

EXECUTIVE BOARDOF TÜV RHEINLAND AG

Volker Klosowski

Chief Technology Officer

Stephan Schmitt

Chief International Officer

Dr.-Ing. Manfred Bayerlein


Thomas Biedermann

Chief Human

Resources Officer

Ulrich Fietz

Chief Financial Officer

FOREWORD BY THE CHIEF EXECUTIVE OFFICER OF TÜV RHEINLAND AG

Dr.-Ing. Manfred BayerleinChief Executive Officer

Operating in a diffi cult and fi ercely competitive market environment, TÜV Rheinland achieved all of its major goals in the 2012 business year and simultaneously laid the foundation for fur-ther growth. For the first time, our revenues climbed signifi cantly above 1.5 billion euros. With an EBIT of more than 113 million euros, we once again achieved an excellent result.

And for the fi rst time in our company’s 140-year history, we generated more than half of our rev-enues outside of Germany in 2012. This clearly refl ects our fi rm conviction that we can only meet the needs of our internationally active customers with a truly global market presence, which is precisely why we expanded it during the reporting year, investing a total of 83 mil-lion euros, a third of which we invested in our global network of laboratories alone. Our pro-ductivity is further increased by the successful integration of fi ve value-creating acquisitions – particularly in the mobility and education sec-tors – and intensifying our marketing and sales activities.

We want to be the best sustainable, self-fi-nanced, and independent provider of testing, inspection, and certification services in the world. The next stage on the path to achieving this goal is defi ned in our Strategy 2017. Until then, we want to nearly double our revenues to 2.7 billion euros while increasing our profi t-ability at the same time. Our global team should grow to approximately 32,000 employees.

We are striving for above-average growth par-ticularly in our Industrial Service, Training and Consulting, and Products Business Streams. Viewed from a regional perspective, our most important growth markets lie outside of Europe: in the BRICS nations and the Next Eleven coun-tries, which include Indonesia, Vietnam, and Mexico. Across all our Business Streams and re-gions, we are also seeing continuously increasing

demand for complete packages of solutions, and we will meet this demand with an appropriate range of service offers. In addition, we expect to see additional growth spurred on by our new test mark, which we introduced in 2013.

Another fi xed component of our Strategy 2017

is our unwavering commitment to sustainable operations and the principles of the UN Glob-al Compact. Our aspiration to play a key role in shaping a sustainable future that meets the needs of both society and the environment is clearly laid out in our corporate mission state-ment, which we updated in 2012. We provide a detailed look at our wide range of sustainable activities in the CSR section of this Corporate Report.

On behalf of the Executive Board, I would like to sincerely thank all of our employees, whose performance in 2012 was once again re-markable. With their technical expertise, their knowledge of the market, and their unbridled enthusiasm, they are the key to the success of TÜV Rheinland Group and also guarantee our continued existence and further growth in this environment of fierce international competition.

Walt Disney once said »If you can dream it, you can do it.« For TÜV Rheinland, I would like to state: we have a number of dreams – and to-gether we will make them a reality in 2013 and beyond.

I hope you fi nd the information in this Corpo-rate Report both informative and inspirational. Happy reading!

Dr.-Ing. Manfred BayerleinChief Executive Officer of TÜV Rheinland AG

» At TÜV Rheinland, we are united by a mutual philosophy, and our strategy also brings us together in pursuit of a clear goal: becoming the best indepen-dent testing and certifi cation company in the world.« Dr.-Ing. Manfred Bayerlein, Chief Executive Officer of TÜV Rheinland AG

TÜV Rheinland

Foreword by the


3

To do so, the Executive Board worked closely together with management to develop impor-tant strategic ideas. The key components in-clude international expansion and marketing our services across different regions; continuing to strengthen the company’s innovative spirit is another. We seek to achieve this by recogniz-ing the market’s needs at an early stage, playing a role in designing solutions, and subsequently offering our customers appealing services. We need to react fl exibly to a constantly changing environment for testing and certifi cation ser-vices and to the needs of our customers.

In most cases, this also requires a local presence. TÜV Rheinland’s international subsidiaries have established new locations and expanded their range of industry-specifi c services using labo-ratories. Recruiting highly specialized employ-ees is another challenge we need to meet if we wish to achieve our goals and enforce our work ethic – a fi xed part of our mission statement –

Thanks to its wide-ranging portfolio of services and its international presence, TÜV Rheinland was affected by the slowdown in the global economy in 2012 to a comparatively little ex-tent. We can be happy with the growth and in-come the company achieved. To secure further dynamic growth and profi tability for the future, TÜV Rheinland can make use of its existing strengths and develop them further.

FOREWORD BY THE SUPERVISORY BOARD CHAIRMAN OF TÜV RHEINLAND AG

Prof. Dr.-Ing. habil. Bruno O. Braun


4

among our staff. We can build on the appeal of the TÜV Rheinland brand, which offers reliable values to both customers and employees.

In the previous business year, the Supervisory Board assisted the Executive Board in a consul-tative and monitoring capacity in accordance with the articles of incorporation and the law, and thoroughly discussed a variety of the Execu-tive Board’s projects during fi ve meetings. This particularly applies to all measures requiring Su-pervisory Board approval. We thoroughly dis-cussed and approved the plans within the scope of Strategy 2017. The Supervisory Board of TÜV Rheinland AG was also provided extensive in-formation on the TÜV Rheinland AG Group’s business development and financial and risk situation. In this context, the work done by the board’s committees played a key role. In March 2012, the election was held for the members of the Supervisory Board acting as labor represen-tatives. Angelika Hecker resigned from the Su-pervisory Board and Andrea Becker was newly appointed representing ver.di NRW. All other la-bor representatives were reelected. Reiner Schon was once again elected as Chairman of the Su-pervisory Board.

The auditing fi rm PricewaterhouseCoopers au-dited the annual fi nancial statements prepared by the Executive Board of TÜV Rheinland AG for the reporting period ending December 31, 2012, and the management report as well as the company’s accounting. The audit of the annual fi nancial statements, the management report, and the proposed appropriation of profi ts did not result in any objections. The Supervisory Board accepted and formally approved the an-nual fi nancial statements.

The Supervisory Board would like to thank the Executive Board, the members of management around the world, and all the Group’s employ-ees for their excellent work during the previous year.

We wish TÜV Rheinland AG and all the com-panies in the Group all the best for the future.

Prof. Dr.-Ing. habil. Bruno O. Braun

Chairman of the Supervisory Board of TÜV Rheinland AG

Our headquarters are located in Cologne – but international markets

have long been a part of the TÜV Rheinland world.

5


TÜV Rheinland

Foreword by the

Supervisory Board Chairman

The second-largest country in the world. A nation of extremes. With its remarkable growth

rates, India is on a sure path toward developing into a major economic power. German compa-

nies are responsible for a considerable share of this boom – and that includes TÜV Rheinland.

Our roots on the subcontinent stretch back to the year 1996. What started back then as a small

office has now grown into a network of 23 locations and seven state-of-the-art testing labo-

ratories. Come join some of our more than 400 employees on a trip through one of our most

exciting growth markets.

CLOSER TO INDIA

Life without electricity – inconceivable to people in industrialized nations, the bitter

reality for around 40 percent of Indian households. India’s problems with electricity

are an enormous obstacle to the country’s development. Our power plant specialists

are supporting the urgently needed modernization of India’s energy industry.

Streets are a country’s lifelines, as they bring people together and support business and

trade. Yet the booming economy and the increase in personal vehicles threaten to block

these lifelines, particularly in major cities. By designing and implementing intelligent traffic

systems, we are working toward a lasting solution to prevent gridlock.

India, the second-largest market for two-wheeled vehicles behind China, is discovering the

car. Low-priced options like the Tata Nano have put the dream of four-wheeled transportation

just within reach for millions of Indians. And our experts have been along for the ride since

the development stage to ensure that quality and safety don’t get left in the dust.

With an estimated potential capacity of 300,000 MW, India is one of the world’s largest wind

power markets. But currently less than ten percent of this immense potential has been tapped.

As a full-service supplier for the planning, construction, and operation of wind power plants,

we are helping to ensure that nothing takes the wind out of the Indian energy revolution’s sails.

Up top traffic jams, down below an easy ride. The Indian government is fighting

the impending gridlock in major cities with a billion-dollar program to expand

public transportation systems. We are contributing more than 30 years of expe-

rience in testing and certifying local public transport infrastructures and safety

concepts to this ambitious project.

Altogether 300 days of sunshine per year make India one of the sunniest countries in

the world. The goal of the government’s »Solar Mission« project, which plans to install

a total of 20 GW of solar power capacity by 2022, is to better tap this potential. With a

state-of-the-art testing lab and our global network of experts, we too are extremely well

positioned for this mission.

The textile industry is one of the subcontinent’s most important economic sectors. Yet small companies

in particular are grappling with the growing competition from other Asian nations and increasing inter-

national standards. With our Softlines laboratories and comprehensive consulting services, we help them

remain competitive over the long term.

The demand for safety and quality inspections is growing around

the world. In order to remain the »most international« TÜV,

we are strengthening our relationships with our globally active

customers.

22

OVER 5.8 Mvehicle inspections worldwide

in 2012.

A Small Sticker with Great PotentialProducts that aren’t popular with consumers don’t last in the market for over 50 years. And it’s even more rare that they grow into global export hits. There is one exception that proves this rule, however, and it is small, round, and available in one of six bright colors. We’re talk-ing about the TÜV sticker for motor vehicles, which we issue more than 2.6 million times a year across Germany.

We admit that the sticker isn’t always purchased altogether voluntarily, but sometimes you have to both lead the horse to water and force it to drink, so to speak – or in this case, gently push people do what is in their best interest. And the success of the general vehicle inspection speaks for itself: in recent years, the number of fatalities as a result

of traffi c accidents in Germany dropped to the same level as in the early 1950s, despite the num-ber of cars on the road being many times greater.

In the meantime, the general vehicle inspec-tion is now responsible for making the road safer in many other countries as well. And in turn, we are responsible for carrying out the inspection. We already conduct more than 5.8 million vehicle inspections annually in France, Spain, Latvia, Argentina, and Chile. In fact, our inspection center in the Latvian capital of Riga has a total of 12 inspection lanes, making it the largest inspection station in the world.

But this doesn’t mean we see any reason to rest on our laurels. We further expanded our inter-national position in 2012 with a combination of both organic and inorganic growth. Early in the year, for example, we acquired a majority stake in the French vehicle inspection compa-ny Secta Autosur, whose franchise partner net-work comprising 870 automobile and 36 truck inspection centers conducts a total of 3.6 mil-lion vehicle inspections annually. In Spain, we expanded our network of inspection centers to 27 locations, with more scheduled to open in 2013. In this context, our growing presence in the major European markets simultaneously strengthens our position in the current political

As complex as the phenomenon of globaliza-

tion may be and in light of many customers’

global value chains, companies in our industry

need only follow one simple rule: go with the

flow or get washed out to sea! As the »most

international« TÜV, we have subsidiaries on all

five continents and, as a result, bring both our

expertise in providing solutions and our sus-

tainable philosophy to nearly all the nations of

world.

23


Closer

to markets

THE »MAGIC TRIANGLE« OF ROAD SAFETY

Driver

Vehicle

Infrastructure

debates on unifying the general vehicle inspec-tion in Europe.

Meanwhile, outside of Europe, we are seeing a signifi cant increase in overall awareness for the issue of traffi c safety, which is also refl ected in initiatives by many governments. Particu-larly countries on the African continent, such as Morocco, Ghana, Congo, and South Africa, have recognized that they were not successful in achieving any significant progress in road safety with their existing – often only rudimen-tary – control systems. Interesting new markets are opening up here, in which our consulting expertise for the complete »magic triangle« of road safety will be in demand.

An ITelligent MoveCourage to fi ll a gap. The principle that genera-tions of high school and college students have used to successfully maneuver through their academic career proves to be less and less of a recipe for success for providers of professional qualifi cation and advanced training programs. Complete packages of solutions, ideally coupled with a transnational presence, are popular. This particularly applies to the IT training sector, which has grown into a gigantic global market – a market in which our Training and Consult-ing Business Stream is to play an important role.

By acquiring the campus GmbH, one of the largest and most successful providers of profes-

sional IT training in Germany, we closed an im-portant gap in our training portfolio in 2012. As a premium training partner to renowned hardware and software suppliers like Microsoft, Oracle, and Apple, campus trains approximately 40,000 people annually with its 120 employees. In this context, the standards of quality are high: each training session is based on the re-spective manufacturer’s seminar concept and is conducted by certifi ed trainers.

The acquisition of e/t/s GmbH in early 2012 was another important strategic step – the compar-atively small but specialized premium supplier of mobile and electronic training formats is an outstanding addition to our portfolio and par-ticularly provides us with additional powerful sales arguments in the international e-learning solutions business.

Together, we wish to prove once again that the whole is more than the sum of its parts. Our vision is that of a powerful ICT service provid-er under the umbrella of the TÜV Rheinland Group that offers its international customers consulting services, training seminars, and so-lutions all from one source. And if nothing else, this should also be reflected in the figures of the Training and Consulting Business Stream: the goal is thus to increase the share of revenue from customers in the IT and communications industries from approximately 35 percent today to more than 50 percent.

24

As of 2012, TÜV Rheinland has already opened

27 vehicle inspections centers in Spain.

SIEGFRIED SCHMAUDER, Executive Vice President of TÜV Rheinland’s Training

and Consulting Business

Stream, which generated

revenues of more than

194 million euros in 2012.

Mr. Schmauder, a key motivation behind the

acquisition of campus GmbH was to further the

company’s international focus in the field of IT

training. Can you tell us specifically where the

trip will head to?

We will initially begin in Eastern Europe in

2013 and then expand our area of operations

in the direction of the emerging markets in

China and South America. In this context, we

will draw upon our excellent working relation-

ships with software manufacturers such as

Microsoft, which will make it easier for us to

enter these markets.

What exactly made campus the right partner for

these plans? After all, the company has so far

only been active in Germany.

In order to understand the logic behind this

acquisition, you need to look at the big pic-

ture. The question shouldn’t be what can cam-

pus achieve, but rather what can campus and

TÜV Rheinland achieve in the future together.

Through our academy, we already have a pres-

ence in 25 countries, and I believe we have

made a name for ourselves and earned a good

reputation. What campus brings to the table is

outstanding training expertise in a field that we

have not been active in up until now. And in ad-

dition, they have a large client base, excellent

relationships with all the major hardware and

software companies, and a strong sales orga-

nization – which altogether makes us a really

powerful team.

A merger of two companies is also always a

merger of two cultures. How did you approach

the issue of integration and how far along in

this process are you today?

We certainly had the advantage that our merger

wasn’t a slam-bang affair, but slowly took place

over a longer period of time. During this time,

we already had the chance to discover many

similarities pertaining to our view of the market

and our future strategic course of action.

With regard to the actual integration process, we

initially set an extremely pragmatic goal – name-

ly, the integration of our administrative process-

es. Here I would say that we have completed

about 90 percent of the process. It goes without

saying that the aspect of integrating our corpo-

rate cultures is a more sensitive issue. From our

perspective as TÜV Rheinland, it is extremely

important to us that we don’t simply force ac-

quired companies to fit into our cultural mold.

In fact, the opposite is true: we want to retain

individual strengths and learn from one another.

An interview with Siegfried Schmauder,

Executive Vice President of the Training

and Consulting Business Stream at TÜV

Rheinland.

» WE WANT TO RETAIN INDIVID-UAL STRENGTHS AND LEARN FROM ONE ANOTHER.«

25


Closer

to markets

A FOCUS ON ORGANIC GROWTH

In 2012, TÜV Rheinland invested a total of 83 million euros internationally – a third

of which was invested in the Group’s worldwide network of laboratories alone.

Ten and a Half in One Fell SwoopIn 2012, we drastically increased our interna-tional presence by opening ten new laboratories.

Four new locations were added to our global network of Softlines laboratories, where we serve the rapidly growing demand for quality and fabric testing from customers in the tex-tiles, clothing, and leather goods industry. As such, our new, fully equipped laboratory in Istanbul, Turkey, has devices for the chemi-cal testing of organic and inorganic materials and for conducting food contact tests as well as systems for testing the physical properties of textiles, color fastness, and fl ammability. This lab’s counterpart is located in the Indian city of Gurgaon, is double the size, and works to-gether with our other new laboratories in Ban-galore and Tiruppur to tap the vast market on the subcontinent.

We solidifi ed our leading position as a provider of testing, inspection, and certifi cation services

for the solar industry by opening our seventh testing laboratory for solar panels in the Korean city of Gyeongsan. Incidentally, the photovolta-ic lab set up in cooperation with Yeungnam Uni-versity is the fi rst laboratory on Korean soil that operates according to international standards.

Inspecting and testing photovoltaic systems is also the job of a new TÜV Rheinland laboratory in Osaka, Japan. The focus of its work, however, will be on testing rechargeable energy storage systems such as lithium-ion batteries or superca-pacitors for a wide variety of applications. As the fi rst large-scale facility of its kind operated by an independent service provider, our battery testing laboratory is equipped with state-of-the-art safe-ty technology and an array of devices for testing battery performance in abnormal conditions.

We are also entering into uncharted waters with the opening of our fi rst testing center for elec-tronic products and automotive spare parts in Saudi Arabia. The city of Jeddah, which we se-

26


lected as the location for the laboratory, is home to the country’s largest harbor, making it perfect-ly suited to meet the needs of countless import-ers and exporters active in the automotive, elec-tronics, IT, and telecommunications industries.

Our new testing center for wireless electrical de-vices, telecommunications devices, and medical products in the Dutch municipality of Leek rep-resents a further unique position held by our company – it is the fi rst accredited laboratory in the Netherlands that measures the effects of electromagnetic radiation on people.

And the new TÜV Rheinland DIN CERTCO labo-ratory in Nuremberg is dedicated to protecting human health – or more specifi cally, the eyes and face. This is where our experts test the safety, suitability, and quality of sunglasses and sport sunglasses as well as complex eye protec-tion devices such as laser and welding goggles or helmet visors pursuant to national and inter-national standards.

And we have recently begun taking a closer look at personal protective equipment in the broad-est sense – from reflective vests to fire boots and even tents – in a modern testing center in Leipzig. With a 60 percent larger space and new testing equipment here, we have created all the infrastructural conditions necessary to achieve our goal of being the market leader in this test-ing segment by 2015.

And last but not least, our largest and most state-of-the-art testing center in the Asian region, the Global Technology Assessment Center in the Chinese city of Shanghai, may not be complete-ly new, yet still appears in a fresh new look. In the second remodeling stage, we expanded the range of tests we offer – including the labora-tory’s equipment – primarily in the fi elds of pho-tovoltaics and consumer products. This means even more effi cient local service and shorter test cycles for our customers. And for us, we have once again come to the conclusion that we ei-ther do things right or we don’t do them at all!

27


Closer

to markets

THE TÜV RHEINLAND TEST MARK

Since the year 2013, we follow a clear rule of thumb: There Can Only Be One!

There Can Only Be One!Humans truly are strange creatures. They send remote control cars on joyrides around Mars, transplant organs, and turn sunlight into power. And yet humans really like it best when things are simple – everything in view, everything under control. This is because, in the positive sense, simplicity creates confi dence – and for a state-of-the-art provider of testing and inspec-tion services, that’s the most important cur-rency there is.

For consumers, it is primarily our TÜV Rhein-land test mark that gives them exactly this confi dence. But our mark isn’t just proof of the quality of the products and services we inspect – it is also symbolic of our company and the TÜV Rheinland brand. As the shape and color of our test mark changed over time, so rose the

danger that our calling card would be misused for deceptive reasons, however. In order to pre-serve the high reputation of our brand and the consumers’ confi dence in our services for the future, we were forced to act: we needed to re-turn to a contemporary, distinctive, and simple design.

And since the year 2013, we are back to a clear rule of thumb: There Can Only Be One! Wheth-er products, services, systems, or processes – in the future, they will all carry a test mark with an identical design, allowing customers and end consumers to immediately recognize qual-ity that has been tested by an unmistakable company.

Depending on the customer’s order, we some-times only examine individual characteristics instead of testing the entire product. In the fu-ture – thanks to approximately 100 easy-to-un-derstand, identical keywords used worldwide – it will be easier for consumers to see whether we tested an entire electric bicycle, or only ex-amined the heavy metal content of its battery, for example. In fact, a customer will only be allowed to use our test mark without explana-tory keywords when we actually conducted a complete safety test.

No matter how much we love technology – we

provide our services for people. Preserving

people’s trust in the seemingly infinite world of

global products and services, permanently im-

proving their living conditions, and promoting

people’s individual development are the chal-

lenges we rise to face each day – with expertise,

dedication, and a heaping portion of humanity.

28


In a globalized world of products, consumer protection and confi-

dence in independent testing services are becoming increasingly

important. This is where we are setting new standards.

29

Closer

to the people

In the testing industry, unfortunately, things aren’t any different than in the clothing and jewelry industry – sooner or later, a strong brand compels copycats with ulterior motives to enter the scene. Since the launch of our test mark, we have been forced to deal with its mis-use – for better or for worse. But no matter how distinctive our new test mark is and no matter how ingenious our keywords are, they are cer-tainly not unforgeable on their own – Which means we had to think up something else ...

The solutions are square, practical, and covered in black and white dots: a QR code. By scanning the code with a smartphone, the consumer is taken directly to our certification database, where they can easily access a wide variety of information about the product itself, its manu-facturer, the specifi c service we provided, and about the test mark. For product and test mark

forgers, thankfully, QR codes are a fairly diffi cult nut to crack. So if scanning the QR code takes you to a digital dead end instead of TÜV Rhein-land’s database, be extremely careful.

The Bodyguard for ConsumersPromotion is part of the trade, and that goes for brand management as well. Because in ad-dition to being unique and trustworthy, being well known is a key factor that determines a brand’s strength. But what’s the best way to promote yourself, particularly when you want to offer people more than just hollow market-ing rhetoric? We found our way: it’s called ac-tive consumer protection. Or rather: promotion with social value.

In this context, we carry out a wide variety of activities in which we use our core competen-cies in the fi eld of product testing for the gen-

Everything you need to know: A QR code

provides direct access to our extensive

certification database.

OUR NEW TEST MARK

Clear, easy to read, and modern: this is

what TÜV Rheinland’s redesigned test

mark looks like »solo,« such as in our

advertising.

The test mark in our advertising: The test mark with space for additional informa-

tion, keywords, web address, and ID number:

The test mark with space for additional informa-

tion, foreign marks like GS, Web address, ID

number, and QR code:

So what’s the point? Approximately 100

keywords provide specific information

about the service we provide in a space

for additional information.

Behind our new test mark stand ... ... over 17,000 employees worldwide ... ... and a clear philosophy.

30


OUR SUMMER CAMPAIGN

had a certified reach of over

105,000,000 contacts within

the German population.

eral good, we look into everyday topics and current issues, and we do not shy away from bringing uncomfortable truths to light. We also often receive inquiries from media outlets, who value us as an expert partner and adviser on topics pertaining to consumer protection.

During the summer of 2012, we went on a Eu-rope-wide shopping spree for the third time. Right on time for the summer break, experts from our Products Business Stream headed out to the most popular European vacation destina-tions to hunt for beach vendors and souvenir stores. On their shopping lists were toys, sun-glasses, and soccer shirts. Back in Germany, the alleged bargains were inspected in our test laboratories in Cologne and Nuremberg – with shocking results: 52 of the 134 items purchased did not meet the European Union’s minimum safety requirements, meaning that they were

never allowed to be sold in the fi rst place. And yet it isn’t even that diffi cult to protect yourself from aggravating or even hazardous shopping experiences when on vacation. With our ten golden rules for souvenir shopping, our experts came up with tips for consumers to protect themselves that will even fi t into a fully packed suitcase.

While wobbly earpieces on sunglasses and strange-smelling T-shirts are comparatively easy to spot, it’s nearly impossible for ordinary people to judge the quality of drinking water – since bacteria and germs do their work in secret. In 2012, we demonstrated that even fresh and clean-looking water should be approached with caution as part of a wide-scale drinking water test that we conducted in public buildings in several German cities. To ensure that samples were collected in conditions that were as true

The experts from TÜV Rheinland always focus on

consumer safety, and inspecting sunglasses is no

exception.


31

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to the people

to life as possible, we decided against flame-treating the water spouts as is required when conducting analyses in accordance with the Drinking Water Ordinance.

The results of our test showed that one third of the 25 samples we took from train stations, city halls, and shopping centers was contami-nated. This contamination can represent an acute health hazard, particularly for people with weakened immune systems. And it gets worse – the level of Legionella bacteria in three of the samples exceeded the legally allowable limit. The possible consequences include life-threatening lung diseases. Every year around the world, more people die from pneumonia caused by Legionella bacteria than in traffic accidents. In light of the acute health hazards,

we informed the affected institutions before publishing the results. The effect was that the people in charge in almost every location took emergency action within a few hours. So there’s no question – for successes like these, we will keep right on promoting.

We Go All OutSalutogenic. In the quiz show »Who Wants to Be a Millionaire?,« popular the world over, knowing the correct meaning of this word would probably be worth a six-fi gure sum. Are you trying to fi gure it out, too? Here’s a tip: the range of services offered by a new TÜV Rhein-land Center of Excellence that we opened in 2012 in Bad Neuenahr, located in the German state of Rhineland-Palatinate, are salutogenic, for example. Still no idea? Okay, we’ll solve the

In 2012, our water tests in public

buildings caught many building

operators by surprise – and moved

them to take immediate action.

32


RETURNING WITH SOMEONE BY YOUR SIDE

Sometimes it’s a stroke of misfortune whose

coming had long been foreseen – and some-

times it’s simply a short moment of careless-

ness. When working people suffer severe illness-

es or accidents, it often means months away

from their job. And when they return, things

aren’t always the way they were before they left.

With our new BEM Plus service – which stands

for »Betriebliches Eingliederungsmanagement«

in German, or »occupational reintegration man-

agement« in English – we want to encourage

companies to act early and approach their em-

ployees who are often sick or out sick for long

periods of time, in order to work together to find

solutions that will allow them to return to work

as quickly and comfortably as possible.

Similar to air traffic controllers, our BEM Plus

managers coordinate all the internal and exter-

nal processes, also providing support, motivat-

ing, and helping to alleviate fears. Who does

the application for rehab need to be submitted

to? When does the Federal Integration Agency

need to become involved? Our experts know the

answers and are exactly what life sometimes

isn’t – predictable and reliable.

puzzle – salutogenic means nothing more than promoting human health and well-being.

That we have long focused on safety and oc-cupational health in all its many forms – from testing particular workplaces with regard to heat and noise exposure to certifying entire companies pursuant to internationally recog-nized standards like OHSAS 18001 or SCC – is not really new. But for a long time, our work was also primarily conducted from the perspec-tive of the question »what makes us sick?« In contrast, not much attention was given to the topic of prevention and the related question »what keeps us healthy?«

This is something we want to end once and for all with our new center of excellence for health management. Here in Bad Neuenahr, a team of doctors, sports medicine specialists, sports scientists, and health experts focus specifi cally on how we can not only maintain, but in fact improve health and performance by systemati-cally training body and soul. In this context, one focus of the services we offer are health checkups for people engaged in high-stress activities, both personally and professionally, such as managers or competitive athletes. De-pending on the goal of the checkup, our ex-perts use state-of-the-art technological analyses – as well as the latest psychometric diagnostic options – to make conclusions about the pa-tient’s health and current level of performance. As a result, the experts can recommend specifi c actions for the patient to take tailored specifi -cally to their living and working situation.

Above and beyond promoting the personal health of athletes and top performers, our ex-perts in Bad Neuenahr also pursue the goal of persuading as many companies as possible of the benefi ts of a health-conscious style of man-agement. In custom-tailored measures, from talks to team workshops and integrated ap-proaches that combine theoretical knowledge with movement and relaxation elements, we get managers and employees fi t for their im-portant role as key communicators within the company. In order to offer this comprehensive service, the center has access to an interdis-ciplinary network of medical specialists, psy-chologists, sports scientists, and health experts.

Before your back goes

out – TÜV Rheinland

helps companies with

health management.

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to the people

The energy revolution is not simply a German

phenomenon – we are also an important partner

on an international level when it comes to a

change of perspective toward a sustainable and

efficient use of energy.

34

DESTINED TO SUCCEED

The Blue Ocean strategy was

responsible for successful

products like Nespresso,

Cirque du Soleil, and the

Nintendo Wii.

We Know Every Wave in the OceanFor centuries, if a company was in deep waters it was normally viewed as a bad thing – until the economists Renée Mauborgne and W. Chan Kim came up with a remarkable new business concept in 2005. Basically, they stated that the best thing a company could do was to be in deep waters – as long as the deep waters were in the right ocean.

In their Blue Ocean Strategy, they divided the business world into two distinct areas: red oceans represent existing markets with fierce competition and enormous price pressure; on the other hand, blue oceans are home to com-panies that offer completely new and subse-quently unrivaled products – with correspond-ing business success. So what does this story have to do with TÜV Rheinland?

That’s simple: we can help your company make the swim from the red to the blue ocean. For instance, by issuing you our new Green Product certifi cation. This combines countless EU guide-lines and rules as well as our own Green Product requirements into an integrated test mark that provides benefits to both manufacturers and consumers. With this test mark, manufactur-ers can clearly stand out from the competition. And for environmentally conscious consumers, our certifi cation serves as a valuable guide when making purchases.

We issued the very fi rst Green Product certifi ca-tions in June 2012 for two televisions manufac-tured by the South Korean electronics giants, Samsung Electronics and LG Electronics. Prior to doing so, we thoroughly tested the TVs for both companies with respect to the chemical substances contained within, their recyclability or rather their reuse of materials, their CO2 foot-print, and their energy consumption and energy effi ciency.

From televisions to tapas: with its sparkling blue waters, Spain is an extremely popular va-cation destination for people across the globe. But viewed through the eyes of Mauborgne and Kim, the water there has been a deep red for

No matter how hard we try – we will never suc-

ceed in catching up with the future. But we can

most certainly play an important role in turning

visions for the future into very real and, above

all, sustainable solutions to the challenges of

our customers or even society as a whole. It is

in pursuit of this goal that each and every day,

our approximately 17,000 employees around the

globe research, test, certify, and provide advice.

35


Closer

to the future

quite some time. For too long the country re-lied on its booming real estate industry, which was responsible at the beginning of the fi nan-cial crisis for nearly a third of its gross domes-tic product. When the real estate bubble burst, unemployment doubled within a few years to almost 25 percent.

The Spanish government realized that their country needed a plan: a plan for the future. Through the systematic funding of sustainable strategies and innovative technologies, it wants to improve the competitive ability of Spain’s economy across the board. But how do you make sure that subsidies and tax breaks actually reach the right people? The solution is hidden behind two rather cryptic series of numbers. And behind the much less cryptic name TÜV Rheinland.

As a state-authorized service provider, we advise and certify companies in the IT and communi-cations sector, the food industry, the chemical industry, and the mechanical engineering sec-tor pursuant to the Spanish standards 166001 and UNE 16602. While the fi rst is a guideline for planning and implementing a specifi c research, development, or innovation project, the second acts – independent of any individual project – as a guideline for the systematic optimization of entire administrative and quality management processes in the fi eld of R & D. Only compa-nies that can produce a certifi cation pursuant to one of these two standards can qualify for public subsidies.

In addition to outstanding business prospects – we are aiming at a tenfold increase in the num-ber of certifi cations carried out in the coming years – another aspect of the Spanish economy’s rejuvenation is becoming increasingly appealing to us: expanding our relationships with univer-sities and research institutes. After all, ensuring that a development engineer’s apparent fl ash of genius doesn’t turn out to be a pipe dream as it moves down the path to market readiness, cer-tifi cation requires the opinion of an established expert in the respective field. As part of our activities to recruit fi tting candidates, we have already established promising contacts with a dozen or so renowned institutions.

Smart Minds for Smart GridsHowever you do it, you do it wrong. At least when it comes to change, this saying seems to prove itself true over and over again. Because while Spain battles with its tough economic structural change, in Germany another gov-ernment-initiated process of change threatens to exceed the speed limit: we are talking about the energy revolution.

Our unique Green Product certification is based

on tests in the following areas:

Carbon Footprint

The carbon footprint is a method of calculat-

ing the greenhouse gas emissions that a prod-

uct causes during its entire life cycle, or parts

thereof.

Energy Consumption and Efficiency

Our tests contain an evaluation of the energy

consumption and energy efficiency of electronic

devices.

Responsible Use of Chemical Substances

Successful certification depends on fulfilling

countless EU guidelines and requirements –

such as the REACH chemical regulation (Regis-

tration, Evaluation, Authorization, and Restric-

tion of Chemicals) applicable in all EU member

states – which restrict the use of hazardous ma-

terials in electrical and electronics products.

Recyclability

We evaluate how recyclable a product is, as

stipulated in the EU WEEE (Waste of Electrical

and Electronic Equipment) guideline. In addi-

tion, we certify the correct use and labeling of

recycled material.

GREEN PRODUCT CERTIFICATION

36


MATHEMATICAL POWER GENERATION POTENTIALof the most important energy sources in Germany (in gigawatts).

Source: Federal Network Agency’s Power Plant List, December 2012

Nuclear Power

Wind Power

Solar Power32

29

21

19

19

12

Natural Gas

Coal Power

Lignite

Driven by generous subsidies, expanding the use of renewable energy sources in recent years has led to a downright fl ood of green power. Based on information from Germany’s Federal Network Agency, photovoltaics and wind pow-er now by far top the list of the most power-ful sources of power in terms of fi gures. And according to Germany’s Minister of the Envi-ronment, Peter Altmaier, in 2020 renewable en-ergy sources will most likely exceed the current goal of providing 35 percent of the total power generation.

But what at fi rst glance looks like a huge suc-cess turns out to be a serious problem when analyzed more thoroughly. This is because power from renewable energy sources is, by na-ture, not always available when industrial and private consumers need it. Take solar power, for example. Since the sun stands low on the horizon during the winter months, it supplies the least amount of power just when people are turning up their thermostats. And wind power is also subject to similar natural fluc-tuations, which unfortunately do not coincide with the biorhythms of the economy and the population.

The consequences are dire – on the one hand, the risk of supply shortages during peak load times increases; on the other hand, the num-ber of voltage fl uctuations in the grid increases, which are particularly dangerous for highly sensitive production systems. So how do we solve this problem?

When electronic devices meet key environmental criteria, they

get our Green Product certification – and their manufacturers get

decisive competitive advantages.

37


Closer

to the future

Wind Parks

Fossil PowerPlants/Combined Heat and Power

Solar Parks

Data Center

Intelligent Nodes

Industry

Smart Homes

Intelligent Buildings

Power and Distribution NetworksData Networks

SMART GRIDS: A MAMMOTH TASK

The German Association of Municipal Companies estimates that the creation of intelligent

power grids will require an investment of 25 billion euros by the year 2030.

The solution lies in a fundamental change of perspective. When the time comes that we are limited in our ability to control power genera-tion, we will be forced to control power con-sumption. The idea is that in the future, smart grids will balance out the fl uctuations in energy production and consumption by collecting con-sumption information from countless devices, exchanging this information, and precisely con-trolling the supply of power they receive. Here’s an example from everyday life: if all the air-con-ditioning units and freezers in a city could be controlled like a smartphone, an energy provid-er could, during peak load times, disconnect the devices from the grid for a few minutes without any signifi cant decline in their effect.

As simple as this sounds in theory – the com-plexity of smart grids poses completely new challenges to technological testing service providers, which we, as the »Power TÜV,« are more than happy to face. Because whether conventional power generation, renewable en-ergy sources, energy effi ciency, communications technology, or data security – our experts have, in some cases, decades of experience in all the fi elds relevant to the successful implementation of smart grids.

Among other projects, we contribute this ex-perience to the project, »Energy and Climate-Effi cient Structures in Urban Growth Centers,« initiated by Germany’s Federal Ministry of Re-

38


GROWTH MARKET

The global market for

electric-powered two-wheeled

vehicles is forecast to grow to

a value of 12 billion US dollars

by 2018.

Lately, the media has been portraying the future

of electric-powered transportation – once a bea-

con of hope in the fight to protect the climate –

in a truly dismal light. But are the dreams of this

alternative form of power for our transportation

needs actually dead?

There is no doubt that costs of the battery tech-

nology are still far from making electric vehicles

really competitive. And there is no doubt that

the sales of electric vehicles – partly because of

these costs – fell far below expectations. There

is also no doubt that, in light of this trend, sev-

eral automakers stopped what were once ambi-

tious development projects. And maybe we all

need to admit that up until now, our expecta-

tions had been too optimistic and our patience

too thin.

But the electric car isn’t the first technology that

has to overcome setbacks on the way to becom-

ing a widely used product, and it certainly won’t

be the last one. But does that change anything

about the enormous potential this technology

has in order to make our transportation in the

future more environmentally friendly?

When answering this question, we should not

equate electric-powered transportation with

the electric car. Because one form of electric-

powered transportation has been around since

the late 19th century, and has been incredibly

successful – the railroad. In this particular traffic

segment, the train of electric-powered transpor-

tation has long left the station on its way toward

the future.

In contrast, another form of electric-powered

transportation is just at the beginning of what is

bound to be a long life cycle – electric-powered

two-wheeled vehicles. Viewed in the West as

more of a recreational product, motorcycles and

scooters are the main form of transportation for

wide swaths of the population in developing

and emerging nations. Anyone who has spent

time on the streets of Calcutta or Bangkok has

most likely been amazed at the huge swarms of

zippy little bikes, and also probably felt a twinge

of discomfort due to the sounds and smells that

they produce. In the short term, this is where

the viable prospects of electric vehicles lie a

million times over – not on the highways of Eu-

rope or the United States.

China showed us how it’s done, with over

200 million electric scooters on the road in the

People’s Republic today. According to estimates

by the research institute Pike Research, the fig-

ure will double by 2016. As TÜV Rheinland, we

also have the ability to continue writing this

success story in other countries. So let’s give

the electric car the time it needs to develop –

after all, there’s enough to do in the meantime.

FOOD FOR THOUGHT

search, since urban metropolitan areas and the inexorably growing megacities in developing and emerging nations represent the most im-portant locations of worldwide power consump-tion. Although they only cover two percent of

the Earth’s surface, they are responsible for three quarters of the world’s energy consumption and about 70 percent of global greenhouse gas emis-sions. Smart grids would thus allow us to have an enormous impact in comparatively little space.

We inspect the safety of electric

vehicles – even in two-wheeled

form.

39


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40


Responsibility

41


TÜV RHEINLAND SELF-IMAGE

MISSION STATEMENT

CSR AND SUSTAINABILITY

Integration of social and environmental responsibility into

the company’s operations and interactions with its stakeholders

Company Policy on Values

and Responsibility

Membership in IFIA and

the UN Global Compact

Adherence to the Law and Compliance

Code of Conduct

Guideline for the Prevention of

Conflicts of Interest and Corruption

Sponsoring and

Donation Guideline

COMPLIANCE

CSR-MANAGEMENT

CSR – THE FOUNDATION OF OUR CORPORATE STRATEGY

With the end of the year 2012, our company’s 140-year anniversary also came to a close: 140 years, during which TÜV Rheinland, as a part-ner to businesses and society, has constantly stood for quality, safety, and effi ciency in con-junction with people, the environment, and technology. Therefore, the concept of sustain-ability has always been deeply rooted in our corporate self-understanding.

The years that now lie ahead carry great chal-lenges for all of us – resource scarcity, popu-lation growth, megacities and the associated infrastructure needs, and food security, just to name a few. We fi rmly believe that social and technological progress is inextricably linked to-gether. And we are there every step of the way in order to make this progress safe and sustain-able for both mankind and the environment.

But there is no doubt that we cannot overcome these challenges with the knowledge and tech-nologies that exist today alone. In light of this fact, in 2012 we began with the implementa-tion of a generic innovation process across the Group, which we want to use to create the con-ditions and methodological skills necessary for a successful culture of innovation in all of our Business Streams and regions. And experience shows – innovations from TÜV Rheinland also make our customers successful over the long term.

With the growing need for solutions that ad-dress large-scale societal challenges in a viable and environmentally friendly way, sustainabil-ity is rapidly developing into a strategic success factor. Our stated goal is to be the world’s best sustainable and independent provider of techni-cal services for testing, certifi cation, consulting, and training.

Our employees are firmly committed to this goal. In 2012, we reaffi rmed our resulting re-sponsibility in our revised Mission Statement, which forms the foundation of our corporate culture. In our Mission Statement, we explicitly commit to our aspiration to play a role in help-ing to create a future that meets human and environmental needs on a sustainable basis.

To ensure that this commitment truly becomes a way of life for our employees, we launched the »Meet[ing] our Mission Statement« initiative. Within the scope of a pyramid system, each of our employees will complete playful exercises to become better acquainted with the content of our revised Mission Statement. This is how we want to ensure that every single employee

42


CSR – a key part of our under-

standing for over 140 years.

part of the Group’s quality management. The Guideline was not changed in 2012. In contrast, one key change was made with regard to our occupational health and environmental protec-tion management systems: to account for the fact that the content and organization of the two systems are steadily becoming more in-tertwined, we combined the two into an inte-grated HSE (Health, Safety, and Environment) management system in 2012. More information on this topic can be found in the »Employees« and »Environment« sections on pages 50 and 61 of this Coprorate Report.

ACTING WITH AMBITION – REPORTING WITH TRANSPARENCY

To our company, responsibility also means transparency. This is why we were one of the fi rst companies to publish a statement of com-pliance with the German Sustainability Code (GSC), the new standard of transparency for sustainable business operations. In doing so, we want to embrace our responsibility to society, transparently present our company’s operations, and promote the easy comparison of how sus-tainable the operations of companies truly are. On April 17, 2012, Professor Ralf Wilde, Execu-tive Vice President Products and Member of the Management Board of TÜV Rheinland Berlin Brandenburg Pfalz e.V., took part in a discus-sion on background information with other cor-porate representatives at the Federal Chancel-lery to report on our experiences with the code and the value it brings. Within the scope of this meeting, representatives of the Federal Chan-cellery affirmed their support of the German Sustainability Code. As such, Germany’s federal government will recommend that all companies who receive public funds should consider the application of the code.

But we do not simply present our impact on the environment and society. More importantly we report on how we handle the responsibility that stems from this impact.

gets on board and carries out their daily duties in line with our principles in a neutral, inde-pendent, environmentally friendly, and socially responsible way.

ORGANIZATION OF OUR CSR ACTIVITIES

At TÜV Rheinland, the issues of CSR and sus-tainability are managed and guided by our Cor-porate CSR & Compliance Offi ce. In this con-text, the Global Head of CSR & Sustainability reports directly to the Chief Executive Offi cer. In addition to other duties, he is responsible for the following: p Developing and implementing TÜV Rhein-

land’s sustainability strategy p Internal CSR and sustainability activities and

projects p Maintaining a dialogue and collaborating

with institutions and initiatives such as the UN, UN Global Compact, GIZ, or the Round Table Codes of Conduct p Committee work p IFIA Compliance Committee p Philanthropic activities

During the reporting year, a total of four em-ployees worked in our Corporate CSR & Com-pliance Offi ce at our headquarters in Cologne. The CSR Offi ce formulates, communicates, and monitors the company’s CSR and sustainability strategy. In addition, it manages all CSR projects across the Group, initiates internal and external activities, and is responsible for reporting to the UN Global Compact and within the scope of the annual Corporate Report. Regional and local CSR Offi cers as well as CSR Offi cers in the in-dividual German Operations support the offi ce in carrying out its duties. These offi cers adapt Group requirements to local cultures and pro-vide information about local CSR and sustain-ability activities. In regular meetings and experi-ance exchanges, information is shared within the network and summarized for the Group.

Since 2009, the organizational structure of our sustainability management has been outlined in a comprehensive CSR Guideline that forms

Responsibility

CSR-Management 43


Our goal by 2020:

–25% specific CO

2 emissions.

Customers

Suppliers

Scienceand

Research

Government-Owned

Companies and GovernmentInstitutions

TÜV RHEINLAND

Media Representa-

tives

Shareholders and

ControllingBodies

NGOs and

Networks

Employees

STAKEHOLDER UNIVERSE

TÜV Rheinland’s most important stakeholder groups

At the end of 2011, we set forth sustainability goals pertaining to climate change and diversi-ty: based on the levels from the base year 2010, by 2020 we want to cut our specifi c CO2 emis-sions by 25% and our energy consumption per employee in Germany by 20%. Moreover, we are focusing on diversity in management posi-tions. We are working on making the manage-ment level more international and increasing the share of female managers.

But since a goal is only as valuable as the mea-sures taken to achieve it, we worked closely in 2012 with the departments and our Group’s in-ternal CSR network to begin drawing up a com-prehensive package of measures for the years 2013 to 2020. In addition to measures taken across the Group, this package also sets forth numerous local and/or regional projects in or-der to best account for individual local condi-tions. Furthermore, the different respective de-partments have already carried out a variety of activities in 2012 in pursuit of this aspiration. You can read more about these activities in the »Employees« section on page 50 and in the »En-vironment« section on page 61.

UNDERSTANDING IN ORDER TO IMPROVE

Whether formulating goals, developing appro-priate measures, or evaluating completed proj-ects – we attach a great deal of importance to the opinions of our stakeholders. Your sugges-tions and feedback give us important ideas for ways to enhance our corporate and sustainabil-ity strategy. We are absolutely certain that the better this strategy is tailored to the needs and interests of our stakeholders, the more success-fully TÜV Rheinland will operate in its markets.

In order to foster a better understanding of the positions and goals of the other party, we began establishing a systematic stakeholder dialogue in 2009. The selection of stakeholders was car-ried out with the requirement that the differ-ent stakeholder groups would be taken into ac-count as comprehensively as possible and that all groups with a connection to our company would be incorporated into the survey. In this context, the TÜV Rheinland Stakeholder Round-

table which we hold once annually has devel-oped into a particularly important instrument besides stakeholder surveys.

In late 2012, we conducted our second extensive stakeholder survey with the help of an external service provider. By the end of the year, a total of 229 participants had submitted answers to a survey divided into two sections, »Sustainability Strategy« and »Sustainability Communication«, either by telephone or online. Nearly half of the completed surveys we received were fi lled out by one of our key stakeholder groups, our employees. About one fi fth had been fi lled out by customers. This distribution allows us to see both internal and external expectations. The re-maining nearly 25% comprised suppliers, non-governmental organizations (NGOs), business and research institutes, federally owned compa-nies, stockholders, and media representatives.

Nearly 80% of the stakeholders surveyed con-fi rmed that sustainability is of key importance to corporate strategy. We were rated very highly when it comes to compliance, while our stake-holders believe that we have room for improve-ment when it comes to our company’s activities on behalf of our employees and protecting the environment.

44


p Offering sustainability

services

p Compliance

p Partnerships with public

and private foundations

and development institu-

tions

p Energy consumption

®Building management

®Mobility

p Resource consumption

®Water

® Paper

p Training and further

education

p Demographic change

®Maintaining employability

®Supporting young people

p Diversity

® Work–life balance

® Increasing diversity in management positions

p Occupational health and

safety

ECONOMICS ENVIRONMENT SOCIAL AFFAIRS

KEY ISSUES FOR TÜV RHEINLAND

Our stakeholders believe that TÜV Rheinland’s greatest scope of infl uence to make an impact on sustainable development lies in our core business. Around two thirds attach great or even extremely great importance to offering ex-plicit sustainability services. And according to the participants, our role as a multiplier both internally and externally can also have a posi-tive impact.

Traditionally, the knowledge gained from our stakeholder surveys is also used as an important element for identifying relevant topics. Com-paring the stakeholders’ assessments with where we have set our priorities provides us with infor-mation about which topics are viewed as impor-tant aspects of TÜV Rheinland’s sustainability strategy by both ourselves and our stakeholders.

As a result, the topics of greatest importance to TÜV Rheinland with regard to sustainability are presented in the fi gure below.

STAKEHOLDER ROUNDTABLE

In addition, on January 18, 2013, the third TÜV Rheinland Sustainability Roundtable with representatives from key stakeholder groups was held. The meeting followed rounds of talks held on February 10, 2011, and Janu-ary 19, 2012. The dialogue process pertaining

to sustainability is held regularly, and in ad-dition to the extensive stakeholder surveys conducted in 2010 and 2012, is part of TÜV Rheinland’s stakeholder activities.

The discussions, which were moderated by two independent experts, focused on enhancing and expanding TÜV Rheinland’s sustainability strategy and goals across the Group and in the individual Business Streams as well as on in-ternal and external communication about our sustainability activities. Participants included representatives from a variety of stakeholder groups such as employees, suppliers, custom-ers, non-governmental organizations, and shareholders.

The participants see great potential for sus-tainable development in TÜV Rheinland’s core business and will support the company by providing constructive criticism. In addition, they all agree that the stakeholder forum helps strengthen TÜV Rheinland’s orientation to sus-tainable economics.

Moreover, the participants agreed to keep their discussions confi dential in order to collaborate objectively, with complete trust, and as effec-tively as possible. Further results of the round-table will be published at the appropriate time upon mutual agreement by all parties.

Responsibility

CSR-Management 45


MEMBERSHIPS AND NETWORKS

TÜV Rheinland is a member of a wide variety of

groups and associations. As a result of the collab-

orative work carried out with members of these

networks, we have been able to establish valu-

able connections and forge new relationships

with companies, NGOs, and both national and

international institutions. It is not unusual for

these contacts and partnerships to later result in

joint business activities.

We signed the principles of the UN Global Com-

pact in 2006 and pegged it into our corporate

Mission Statement as well as our Company Policy

on Values and Responsibilities. This particularly

applies to the regulations and declarations on

human and labor rights, children’s rights, main-

tenance of sustainable protection of the environ-

ment, and fi ghting all forms of compulsory labor

and corruption.

Furthermore, the values and principles of the UN

Global Compact form a central guiding principle

for our dealings with business partners. By active-

ly participating in international projects – such as

in the fi eld of environmental protection, training

seminars on compliance and the UN principles,

or in discussions on the role of corporations in

confl ict regions – we strengthen our position as

a reliable and valuable partner that plays its role

in implementing and spreading ethical business

practices and sustainable development.

We are convinced that the UN principles must

play a larger role in everyday corporate activities.

That is why we have taken on an active role in

the German Global Compact Network (DGCN)

and regularly participate in its workshops.

Above and beyond the Global Compact, we also

actively participate in a number of other major

initiatives:

p TÜV Rheinland has been active in the Round Table Codes of Conduct since 2006. The roundtable is concerned with the role of corporations in procurement from and out-sourcing to developing countries, and dis-cusses current social and labor policy issues. The roundtable is also a multi-stakeholder

forum where unions, corporations, associa-tions, and non-governmental organizations collaborate with one another, leading to joint initiatives, positions, and projects, if necessary.

p As a member of the International Federation of Inspection Agencies (IFIA) – the global umbrella organization for testing service providers – we have established a strong, industry-specifi c network on topics relating to ethics and compliance. The umbrella orga-nization – which, among other things, comes together to discuss compliance regulations, professional ethical principles, and scientifi c standards and methods – is a global leader and sets standards for the entire industry. As one of its four largest members, we are repre-sented in almost all of its expert groups.

p In turn, the German testing organizations have joined to form the TÜV Association (VdTÜV), which represents their interests at national level. TÜV Rheinland has once again been a member of the VdTÜV and its alliance of brands since 2011. Among other associations, Dr.-Ing. Manfred Bayerlein rep-resents the VdTÜV on the board of directors of the Federation of German Industry (BDI). In addition, we are represented through the brand alliance in the CEOC (Confed-eration of Inspection and Certification Organizations).

p As a company with its roots in the engineer-ing sector, it makes sense that a large num-ber of our employees are members of the As-sociation of German Engineers (VDI). Prof. Dr.-Ing. Bruno O. Braun, Chairman of the Management Board of TÜV Rheinland Berlin Brandenburg Pfalz e.V. and Chairman of the Supervisory Board of TÜV Rheinland AG was president of the association from 2007 until late 2012. The VDI promotes the discussion of scientific ideas and advocates Germany as a location for technology. Initiatives like Women in MINT Professions (Mathematics, Information technology, Natural sciences, and Technology) and systematic activities to instill an ethusiasm for technology in young

46


people are just two examples of a wide vari-ety of projects the association carries out to support technology and innovation.

p In his role as VDI president, Prof. Dr.-Ing. Bruno O. Braun was also active in 2012 as the spokesman for the »Rhine Ruhr Power« busi-ness cluster. This alliance of around 80 engi-neering fi rms, suppliers, energy companies, service providers, and research institutes in the fi eld of power plant technology also counts TÜV Rheinland as one of its members. In this context, we actively support, among other things, cluster’s initiative to set up a Future through Innovation Center for energy issues in North Rhine-Westphalia.

The walk to the awards ceremony was

a short one – on October 17, 2012, our

Chairman of the Supervisory Board,

Prof. Dr.-Ing. Bruno O. Braun, accepted

an ÖkoGlobe award for lifetime achieve-

ment at TÜV Rheinland’s headquar-

ters in Cologne. The jury of the inter-

nationally recognized environmental

award honored Prof. Dr.-Ing. Bruno

O. Braun for his outstanding contribu-

tions to the establishment of an interna-

tional, knowledge-based company. The

performance artist and co-initiator of the

ÖkoGlobe, HA Schult, praised the award

winner as someone »who approaches his

work with farsightedness, business cour-

age, and expert knowledge«.

PROF. DR.-ING. BRAUN RECEIVES

THE ÖKOGLOBE AWARD FOR LIFETIME

ACHIEVEMENT

COMPLIANCE

LEGAL COMPLIANCE AND VALUES WITHIN TÜV RHEINLAND

In our corporate Mission Statement which we revised in 2012, we commit ourselves to the val-ues of competence, reliability, incorruptibility, independence, and openness as well as corpo-rate, social, environmental, and economic re-sponsibility. For over 140 years, our customers have trusted in our integrity as a globally active provider of testing, certifi cation, consulting, and training services. We want to live up this trust.

We believe that the working conditions of our employees or our environmental standards need to measure up to both the UN Global Compact and our own internal corporate guidelines and adhere to our Company Policy on Values and Responsibility. We can only achieve this goal when our employees internalize the applicable laws and our corporate guidelines as binding rules, and carry out their daily work in accor-dance with them.

TÜV Rheinland has been a member of the In-ternational Federation of Inspection Agencies (IFIA) since 2007, and has introduced a compli-ance management system in line with the IFIA’s Compliance Code. By signing the UN Global Compact in 2006, we also accepted the princi-ples stipulated within for our company. Issues such as human rights, environmental protec-tion, occupational safety, and anticorruption are of elementary importance to the long-term suc-cess of our company. Our compliance manage-ment system is evaluated annually pursuant to select criteria of the IFIA’s Compliance Code. The results of this evaluation are then reported to the IFIA. We continuously make advancements and improvements to the system on the basis of the recommendations generated from this analysis.

Prof. Dr.-Ing. Bruno

O. Braun at the

awards ceremony

in Cologne.

Responsibility

Compliance 47


LANGUAGE DIVERSITY

Our compliance guidelines are

available in nine languages.

THE COMPLIANCE MANAGEMENT SYSTEM’S FAR-REACHING SPHERE OF INFLUENCE

Our compliance management system is set forth in a number of different guidelines, codes, and recommended actions that are binding for all employees. In this context, we have drawn up the following binding documents, among others: p TÜV Rheinland Code of Conduct p Compliance Guideline p Guideline for the Prevention of Confl icts

of Interest and Corruption p Sponsoring and Donation Guideline

These documents are available in both German and English. We have also made several guide-lines available in the national language of the respective country. Our compliance guidelines are available in nine different languages. Our application processes stipulates that we present our compliance rules online to new employees. We then provide more detailed information about these rules during a voluntary two-day seminar, »New at TÜV Rheinland.«

When entering into business relationships with TÜV Rheinland, we have defi ned general terms and conditions of purchase for our suppliers, and we work toward getting these companies to accept them. Within the scope of these terms, suppliers agree to adhere to our compliance guidelines, applicable laws, human rights, and the principles of the UN Global Compact. If a supplier breaches one of these binding rules, we reserve the right to terminate the agreement for cause.

BLACKLIST OF COUNTRIES

With our Company Policy on Values and Re-sponsibility and our Code of Conduct, we have committed ourselves to maintaining high ethi-cal standards. Our collaboration with custom-ers is also governed by these guidelines – and they are incorporated into the process even be-fore entering into a business relationship. We are committed to avoiding business with com-panies whose main product is land mines or weapons of mass destruction. In addition, TÜV Rheinland’s Executive Board created a »Blacklist

of Countries« in 2012. This stipulates that doing business with companies from risky countries must fi rst be evaluated, and that it may only be allowed with certain conditions, or be partially or completely prohibited. This particularly ap-plies to business with countries which pose an increased risk to the safety of our employees or an increased fi nancial risk.

INTERMEDIARIES

We have set up a process which sets forth that new agreements between companies in the TÜV Rheinland Group and intermediaries (such as agents, external sales partners, and consultants that provide intermediary services) that exceed a certain fi nancial value must be entered into on the basis of an applicable catalog of approv-al requirements. In this case, the Compliance Offi ce works with Corporate Legal toward in-corporating compliance stipulations into the agreements.

ORGANIZATION

We operate a compliance system with inter-national branches. It is managed centrally by the Chief Compliance Offi cer, who reports di-rectly to the CEO. In addition to the Corporate Compliance Office, 65 Compliance Officers have been appointed who are responsible for compliance-related issues in the individual German Operations and at the local level. They regularly report to the Chief Compliance Offi cer about regional compliance activities. We secure the continuous dialogue among the Compli-ance Offi cers themselves and with the Corpo-rate CSR & Compliance Offi ce at the company headquarters through various virtual meetings. In addition, we held a global Compliance Of-fi cer meeting for the very fi rst time in Cologne last year. A total of 22 Compliance Offi cers from our domestic and international subsidiaries par-ticipated in the event. The Compliance Offi cers from China, India, and Poland, among others, presented their local compliance programs. The next meeting is already scheduled for 2013.

Last year, we carried out a risk analysis for TÜV Rheinland. As a result of this analysis, we cre-ated a risk matrix which applies to the entire business fi eld. This was drawn up in collabora-

48


COMPLIANCE TRAINING

Close to 70% of our em-

ployees have successfully

completed our compliance

e-learning program.

tion with numerous general managers from our domestic and international subsidiaries and in coordination with a variety of divisions (includ-ing Legal, Controlling, and Finance). The results are used to analyze the risks currently facing our business operations.

DEFINED PROCEDURE FOR DEALING WITH COMPLIANCE CASES

We introduced a procedure for dealing with compliance cases that is standardized for all employees and companies in the Group. This procedure stipulates that the respective Com-pliance Offi cer is responsible for initiating the required steps at the local level. In this context, the Local Compliance Officers can also seek legal counsel from external attorneys, if neces-sary. The Corporate Compliance Offi ce is to be informed of the matter and provides support and advice to the Local Compliance Offi cer. In this way, we can guarantee that the matter is dealt with transparently and that all the nec-essary measures are taken. In certain cases, the Compliance Board is also involved in the mat-ter as the highest committee. Under the terms of this procedure, misconduct on the part of employees may lead to consequences affecting their employment and criminal charges. Fines or government sanctions for breaches of statu-tory provisions were not imposed on companies in the TÜV Rheinland Group in 2012.

COMPLIANCE INQUIRIES IN 2012

In the previous year, the Compliance Office handled a total of 110 compliance incidents. The majority of these were inquiries. The smaller portion of this total related to cases of suspected misconduct and agreements with in-termediaries. The inquires received can be par-ticularly attributed to the following categories:

p Accepting gifts/invitations from business partners p Critical customer relationships (such as

with arms manufacturers) p Customer relationships with companies

from »risk countries« p Ethics p Sponsoring

Some of the cases of suspected misconduct per-tained to criminal actions. The investigated cases typically concerned the following areas:

p Fraud p Corruption p Inaccurate test reports p Personnel p Forgery of documents

Our employees have access to a compliance hot-line which can be used to provide anonymous information about employee misconduct. It is available to employees of both domestic and international companies in the Group, and is serviced by external attorneys who handle all calls in a strictly confi dential manner.

TRAINING

All of our employees are required to take part in a compliance training. Most employees are trained using a compliance e-learning program. The program, which is currently available in 44 countries around the world, was translated into French, Polish and Russian in 2012. As a result, our compliance training program is now available in nine different languages. During the program, employees become familiar with the topic of compliance and guidelines appli-cable in our company using model cases. The e-learning program particularly covers the is-sues of anticorruption, our Code of Conduct, and human rights. At the end of the previous year, a total of 11,767 employees had success-fully completed the e-learning program. The is-sue of compliance is of special importance to new general managers. We are quite aware of this importance, which is why we held a train-ing seminar on the topic (both nationally and internationally) for the fi rst time that was spe-cifi cally geared for general managers and autho-rized representatives to familiarize them with their responsibilities.

Responsibility

Compliance 49


EMPLOYEES

AN EMPLOYER WITH A CLEAR PROFILE

Technical testing services are TÜV Rheinland’s core business. As such, our company’s success – and our contribution to sustainable develop-ment – is based on the skills and dedication of our employees. Our personnel policy therefore aims to continuously enhance both our employ-ees’ qualifi cations and their motivation. This is because knowledge fi rst becomes an asset to our company when it is used to the company’s bene-fi t and constantly advanced.

Every single employee is both the face and an ambassador of our company. That is why we

strive to internalize, live out, and represent both internally and externally the corporate values – such as reliability, diligence, transpar-ency, openness, dedication, and enthusiasm – documented in our Mission Statement (revised in 2012 and applicable across the Group) and in our management principles. Our corporate culture is just as conscious of traditions as it is focused on the future, sustainable, and interna-tional. We interact with one another in a man-ner that seeks to strengthen the ability to give and take criticism and expects everyone to be prepared to engage in constructive dialogue.

This corporate culture also has a direct impact on our reputation as an employer. The umbrella brand TÜV Rheinland is particularly well known in Germany and has an excellent reputation. Not long ago the employer TÜV Rheinland stood primarily for stability and security, but today we also acquire potential high perform-ers through our credible, sustainable operations and wide-ranging development opportunities in an international environment. The signifi cant progress we have made when it comes to our image as an employer is refl ected in a number of renowned rankings. Continuously expand-ing and constantly improving our image is what drives our department responsible for employer branding day in and day out.

NOT ADMINISTRATION – MANAGEMENT!

At a company like TÜV Rheinland, whose suc-cess is highly dependent on the performance of its employees, Human Resource (HR) manage-ment fulfi lls much more than just an adminis-trative function – it is a key success factor. Our dynamic international expansion and numer-ous acquisitions in recent years have caused certain ineffi ciencies to arise in structures and responsibilities pertaining to personnel matters. In 2012, we achieved important milestones in optimizing these structures, thus creating the foundation for even more effi cient and high-quality HR work.

MODEL HR MANAGEMENT

Every year, the CRF Institute identifies

companies with exemplary human re-

source management on the basis of inter-

national standards. In 2012, we received

the »Top Employer« employer award for

the fifth time in a row. We particularly

stood out in the categories »Career Oppor-

tunities« and »Training and Development.«

MOST POPULAR TESTING SERVICE PROVIDER

In the trendence research institute’s

»Graduate Barometer 2012,« we jumped

from 50th to 37th on the list – making us

the most popular testing service provider

among engineering graduates.

POPULAR AMONG EMPLOYEES, TOO

The Internet platform kununu gives em-

ployees the ability to anonymously rate

their employers. Our employees have rat-

ed us so highly that kununu has named us

a »Top Company.«

50


CHIEF HUMAN RESOURCES OFFICER

Industrial Service/Life Care German Operation

Mobility German Operation

Products German Operation

Training and Consulting/Systems German Operation

Asia Pacific

Western Europe

Central Eastern

Europe

North America

South America

India, Middle East,

Africa

Greater China

Global HR Process Development

HR Marketing

Compensation and benefits

HR information

HR principles

HR development

Administration

Social Services

Retirement benefits

HUMAN RESOURCE MANAGEMENT

Our Chief Human Resources Offi cer oversees a total of seven administrative departments across our regions and German Operations. In 2012, we restructured them with a particular focus on increasing the autonomy of the previously consolidated functions of employer branding, employee relationship management, recruiting, and employee development. As a result, we now have the ability to carry out projects, especially ones across the Group, much more systemati-cally and ultimately more effi ciently. Another important measure we took was the establish-ment of an internal social service as its own in-dependent department. This department is now responsible for coordinating and enhancing our »Family and Career« program, our activities in health management, and our initiatives to pro-mote women in scientifi c careers, among other duties. In order to give our wide-ranging initia-tives and the necessity to develop, implement, and optimize processes and tools in the fi eld of human resources an organizational home and responsibility, the Global Human Resources

(HR) Process Development department was established as of January 1, 2013.

Four heads of human resources for our six ma-jor German Operations and seven HR managers and/or coordinators according to our regions represent the point of contact in the operative divisions, and have the goal of ensuring that our human resources strategy is implemented uniformly throughout the Group

THE DIFFERENCE IS WHAT COUNTS

We view diversity in all of its many aspects as a strength that we want to systematically expand, and this is also clearly refl ected in our sustain-ability goals. In order to document this aspira-tion and its achievement, we have begun work on a Diversity Charter that will initially apply to Germany; extending it to other Group regions is planned. The focus of our goals and a variety of activities in the fi eld of human resources refl ect this ideal of diversity. For example:

Responsibility

Employees 51


»A GLOBAL PLAYER«

with over 500 locations in

65 countries.

IT’S GIRLS’DAY!

Fashion, horses, cute boys? As if! On April 26,

2012, more than 100 girls between the ages of

10 and 16 were captivated by very different top-

ics at a total of five German locations: topics

such as solar technology, cars, chemistry, and

technology. For example, at our headquarters in

Cologne the participants took a look behind the

scenes of a vehicle testing center and the solar

and chemical lab. In Nuremberg, the exciting

topic of inspecting toys was on the agenda and,

in addition, our vocational trainees provided

first-hand information about our »Chemical Lab-

oratory Assistant« and »Construction Material

Tester« vocational training programs. Vocational

trainees from the TÜV Rheinland academies in

Berlin, Dresden, and Rostock also present their

programs in the fields of metal, wood, electron-

ics, and vehicles in an event entitled »Careers

You Can Touch!«

p We want our most important decision-mak-ing bodies to be as international as possible p We seek to promote the employment of

women, particularly in leadership positions p We wish to create a working environment for

our older, experienced employees that does justice to their individual working capacity

Although the name might not sound like it, with over 500 locations in 65 countries, TÜV Rheinland is a true global player in the inspec-tion industry. We now employ almost 60% of our workforce outside of Germany. We want to use our internationalism as a strength and expand it in the coming years. In addition to exchanging technical knowledge across borders, we attach significant value to the mutual ex-change of cultural values. Our global orientation should be present and felt every day through the greatest possible share of our employees. In this

context, it goes without saying that we advocate fair, comparable working conditions in our dif-ferent regions and areas of operation.

In 2012, we particularly dedicated a whole series of initiatives to the advancement of our cur-rent and potential female employees. For ex-ample, Thomas Biedermann, our Chief Human Resources Officer, spent an entire day within the scope of TÜV Rheinland’s first Women’s Day answering questions and discussing sug-gestions and constructive criticism in person and by e-mail on the issue of »Advancement of Women.« In addition, our company took part in the national Girls’ Day for the fi rst time at not one, not two, but fi ve of our locations – namely Cologne, Nuremberg, Berlin, Dresden, and Rostock. The goal of this event is to spark girls’ interest in technical careers.

During this somewhat different school day, the students can take matters into

their own hands and witness technical careers live and in action.

52


»BLACK BELT« PROGRAM

TÜV Rheinland has offered

advanced training for experts

since 2012. In addition to

technical and methodological

skills, these training seminars

also help participants improve

their social skills.

We will continue our diversity campaign in 2013 with additional new activities. For instance, we are striving to establish a women’s network across the Group that will give our female em-ployees the opportunity to regularly discuss their experiences – including with external par-ticipants. By launching a blog about Interna-tional Women’s Day, we also want to use digital media as a forum for this issue. Besides that, we are planning an event with the purpose of de-veloping initial ideas for institutionalizing the volunteer work carried out by retired or soon to be retired TÜV Rheinland employees.

OUR WORKFORCE IN FACTS AND FIGURES

Our workforce once again grew steadily over the past year, with our company employing an av-erage of 17,218 people (previous year: 15,961). With nearly 11% growth at our companies out-side of Germany to a total of 10,183 employees, we continued the trend toward an increasingly international workforce which we have seen in recent years. Yet also the number of employees in Germany (full-time equivalent) increased from 6,774 to 7,035 over the previous year.

For a growing business, highly loyal employees – and safeguarding and expanding the knowledge that comes with it – is one of our foremost ob-jectives in the human resources sector. Com-pared with the German economy’s average, our 5.44% turnover rate remained low in 2012. In Germany in 2012, 163 female employees and 230 male employees left our company.

The share of full-time employees in Germany remained constant year-over-year, at about 85%.

With respect to cultural diversity and regional origin, our employee structure in Germany (in-cluding management bodies) probably matches the German average due to our nationwide pres-ence. By the same standard, our international locations favor local personnel.

In Germany and abroad, female employees comprise approximately 40% of our workforce. The share of women in management positions is lower; in Germany the upper levels of man-agement (1st and 2nd levels) comprise 11% women – abroad, this fi gure lies at 16%.

Most of our employees in Germany are between the ages of 30 and 50 – this group includes 60% of the total workforce. Abroad, this fi gure stands at 53%. Our employees’ level of education in Germany continues to be high, with 50.7% holding university degrees.

BLACK BELTS AVAILABLE

Knowledge is the ultimate production factor for companies. But of all things, this factor is also particularly diffi cult to manage, since knowledge is a resource that changes and expands almost incessantly as a result of new information, ideas, and experience. This makes the challenge that TÜV Rheinland’s knowledge management faces just as complex – making our collective knowl-edge available and usable for every employee worldwide at any time.

In this context, our global corporate portal »blueye« plays a key role. As what might be called the organization’s collective memory, it consolidates all of TÜV Rheinland’s information in one place and makes it accessible through a uniform interface using a document manage-ment system. The lion’s share of the content comprises technical information and informa-tion from sales and marketing. In 2012, HR management took it upon itself to work on both presenting its information in more detail and an integrated interaction over blueye; implementa-tion is planned for the second quarter of 2013.

Responsibility

Employees 53


Germany Abroad

6,774

6,766

9,187

7,646

7,035 10,183

2011

2010

2012

Employees in Germany and AbroadFull-time equivalent

Male employees Female employees

230 1632012

Employee Turnover by Gender in Germany

1st and 2nd management levels

Employees by Function and Gender in Germany in %


85.9

70.4

80.3

31.8

89.0

14.1

29.6

11.0

68.2

19.7

Administrative services

Scientific experts

Technical staff

3rd management level


Ger

man

y

Cen

tral

Eas

tern

E

uro

pe

Asi

a Pa

cifi

c

Gre

ater

Ch

ina

Ind

ia, M

idd

le

Eas

t, A

fric

a

No

rth

Am

eric

a

So

uth

Am

eric

a

Wes

tern

E

uro

pe

Workforce by Gender in %

37.4 39.5

26.4

49.3

23.5

76.5

50.7

26.1 30

.4

46.0

62.6

60.5

73.6

54.0

73.9

69.6

Managers by Gender in %

Male employees Female employees10

.5

66.2

88.1

78.3

91.3

8.7

21.7

89.8

83.3

82.6

89.5

33.8

11.9

17.4

10.2 16

.7

Ger

man

y

Cen

tral

Eas

tern

E

uro

pe

Asi

a Pa

cifi

c

Gre

ater

Ch

ina

Ind

ia, M

idd

le

Eas

t, A

fric

a

No

rth

Am

eric

a

So

uth

Am

eric

a

Wes

tern

E

uro

pe

Up to age 30 1

Ages 30 to 50 86

Age 50 and up 85

Age Distribution in Germany1st and 2nd levels of management

In Germany, 37.4% of our employees are female; abroad,

the figure is 36.3%. A total of 58% of our employees in

Germany are between 30 and 50 years old. Abroad, this

figure stands at 53.4%.

In 2012, we employed an average of 17,218 employees

(full-time equivalent on the reporting date, [previous year:

15,961 employees]). With nearly 11% growth abroad, we

continued the trend toward an increasingly international

workforce.

In 2012, our employee turnover rate in Germany remained

low, at 5.44%. The average length of employment in Ger-

many stands at about 11 years. In addition, 92.5% of our

employees in Germany have a permanent employment

agreement.

* All employment statistics for Germany are based on

per-head data as of the reporting date, and all employee

information about foreign subsidiaries is based on full-time

equivalent data as of the reporting date (December 31,

2012). Deviations from this practice are stated in the text.

The statistics apply to 90% of foreign subsidiaries.

The generally low percentage of women in technical ca-

reers, which applies all the way from vocational training

programs through to management levels, is also reflected

in our employee structures.

Similar to the distribution in our workforce, men are also

represented more strongly in management.

CENTRAL EMPLOYEE DATA*

54


»LOCAL DIALOGUE«

was held in Brazil, China,

Hungary, Poland, the United

States, and Japan in 2012.

As good and important as digital knowledge management is, it can never fully replace the personal transfer of skills and the extensive wealth of experience of many of our long-term employees – skills and experience that are both of elementary importance to the company and particularly to vocational and advanced training of our specialized experts. Conscious of this fact, under the direction of the divisional heads, we pushed forward with advancements to our train-ing for specialized experts in 2012. Over the short term, we are striving to standardize and simul-taneously optimize the »initial training« of our employees – which, upon successful completion, offi cially authorizes them to carry out inspections in a certain fi eld. The long-term goal of this ini-tiative is to elevate the expertise of as many of our employees as possible to »black belt« level – namely, develop them into qualifi ed experts and key communicators of knowledge in their fi eld. In addition to technical and methodological skills, we also want our employees to systemati-cally develop their social skills. Within the scope of training seminars for specialized experts, we also want to make much better use of the po-tential offered by systematic mentoring in the future.

As a rule, we motivate all of our employees to become involved in networks, working groups, and specialty and project teams – both inside and outside of our company. Aside from gaining and transferring knowledge, we also want this pro-cess to promote general communication among employees.

WE NEED TO TALK

An open and fair feedback culture is absolutely critical to successful HR and corporate develop-ment. It is extremely important to us that giv-ing and receiving do not get reduced to purely a question of hierarchical position, but instead equally represent a right and a duty for all of our employees.

All of our managers around the world undergo a comprehensive annual management review. Furthermore, in Germany the structured em-ployee interview is, in addition to a possible ad-ditional performance review, required across all levels of the company. In order to do justice to the signifi cant importance of this instrument, we strengthened our focus on it in 2012. We were quite pleased with the result – the vast majority of our managers actively support the use of regular employee interviews. Alternating every other year at two-year intervals, everyone has the opportunity to either provide feedback through a global employee survey, or employees have the option to provide specifi c feedback to their supervisor; in both cases, the feedback is completely anonymous.

In 2011, we launched an event series entitled »Local Dialogue« in Germany, and since then it has successfully taken root and was continued in 2012 around the globe. As such, in 2012, a to-tal of 12 dialogues were held in China, Hungary, Poland, Brazil, the United States, and Japan. At each fully booked event, our CEO Dr.-Ing. Manfred Bayerlein and members of senior man-agement provided information about TÜV Rhe-inland and its many aspects before answering the numerous questions posed by the participat-ing employees. We already plan to invite our employees to the next »Local Dialogue« events in 2013.

In 2011, we conducted the fi rst of the aforemen-tioned employee surveys, named »together«, and received a pleasing number of completed surveys, some praise, but also clear tips on areas where we can stand to improve. Our employees particularly saw the latter with regard to »In-formation on Company Goals and Profi tability« and »Management and Change Culture.« The impressive number of measures we initiated in 2012 – a signifi cant portion of which we also completed over the course of the year – in reac-tion to the results of this survey, namely 450, is evidence of how seriously we take this feedback.

Responsibility

Employees 55


Actions Takenas a result of the employee survey

*Areas of focus.

Support, advancement, and development*

Special area

Communication and team work

Tasks and work processes*

Information on company goals and productivity*

Management and change culture*

Identification with and relationship to the company

Motivation and job satisfaction

Customer orientation and image

Praise and recognition

Pressure to perform and job satisfaction

93

71

60

59

54

50

26

23

10

3

1

We will see whether or not our efforts were suc-cessful in 2013, because we want to repeat the survey during the current year, and in doing so, establish this tool as a fi xed element of our feedback culture. A key goal in this context will also be to further improve on the number of participants in order to increase the signifi cance of the survey and receive even more construc-tive suggestions.

GROWING TOGETHER

In 2011, we created the Talent Teams, a highly

promising staff development tool. We are us-

ing this tool to implement our »development

teams« concept, which is well established

and proven in Germany, for the first time on

an international scale. Equipped with fun-

damental knowledge in the field of project

management and various control and sup-

port functions, the selected employees work

in small groups focused on a specific task

for a period of several months. For example,

our first Talent Team in the Asia Pacific re-

gion came up with approaches to improve

the certification process.

CLIMBING THE CORPORATE LADDER – STRATEGICALLY

We offer our employees a wide range of devel-opment and advanced training opportunities at every stage of their career. In order to best de-termine an employee’s development potential and possibly also ascertain their direct eligibility for certain fi elds of activity, like sales or project management, we created the »Talent Potential Evaluation,« a tool used to identify potential. The results of this evaluation are used to initi-ate the fi tting general and individual develop-ment. In addition, we also identify promising young professionals through direct inquiries at management level. To get to know the suggest-ed candidates better, we invite them to events like our »Young Professional Conferences.« Subsequent programs like our Assessment/De-velopment Center, Talent Teams, Management Development, and the Management Academy modules all comprise possible elements of the development program.

When it comes to our advanced training oppor-tunities, we generally utilize a fl exible mix of tried-and-tested (seminars, workshops, coach-ing) and innovative methods (e-learning, virtual classrooms). All employees around the world can access selected e-learning courses via the CONECT learning platform irrespective of their location, business stream, and learning times. Our in-house service provider intr@in, which

56


has over 20 years of experience in education and training, is responsible for the develop-ment, organization, administration, and man-agement of our interdisciplinary training needs.

Our managers are expected to be completely at home in an international environment. And our specialists with project management and training duties also need to increasingly incor-porate an international focus into their work. As a result, longer assignments abroad are increas-ingly becoming a part of our employees’ careers and an increasingly important instrument in HR policy. We support the advancement of our upper-level managers with comprehensive training programs with the aforementioned Management Academy. A series of seminars held in 2012 was especially geared toward man-agers with more than fi ve years of management experience, and gave them the opportunity to improve their coaching skills and better fi ll their role as mentors. A more intensive interdis-ciplinary exchange of information and ideas is also an important goal that we are pursuing in Germany with our »Management Workshop.«

But our employees without management re-sponsibilities are also more frequently presented with opportunities for assignments abroad or the ability to work on international projects or as part of an exchange program. As part of our internal communications, we repeatedly invite our employees to actively express their interest in an international assignment. In the future, an international trainee program will also sup-port internal job rotation. In 2012, we launched a corresponding pilot project in Controlling. We give our employees the skills they need for their assignment abroad in a variety of courses and seminars. These range from our in-house language program »let’s go international« to in-tercultural training courses. And since a foreign assignment is usually associated with a whole mountain of administrative work, an expert team from HR is available to assist and advise the employees concerned.

Documented Training and Further Education Days in Germany

2011 2012

Trained employees 3,325 4,131

Training days for new experts4,674 7,675

Seminar days for new employees 633 887

Further education days 10,695 14,773

Total training and further education days 16,002 23,335

STARTING A CAREER FROM POLE POSITION

As a company that operates in a responsible manner, it is only natural that we give young people the ability to launch their career by participating in a qualifi ed vocational training program.

We offer vocational training programs in both administrative and industrial/technical careers at different German locations. The spectrum of professions ranges from offi ce workers and qualifi ed IT specialists to chemical laboratory workers and medical assistants, as well as cooks and building material testers. Our goal for the coming years is to increasingly move the previ-ous focus of our vocational training programs from administrative positions – offi ce workers regularly comprise the largest share of trainees – to professions with a more productive focus. In doing so, we want to systematically increase the number of young talents in the areas where a lack of specialized employees is already becom-ing apparent today and will particularly be the case in the future.

The number of trainees we accept each year is de-termined by our current needs and the fi elds of application available in our German Operations. We promise all of our trainees that we will hire them for at least six months after they success-fully complete their training program. We also endeavor to provide our trainees with a perma-nent employment agreement in our company.

Responsibility

Employees 57


In addition to the conventional manner using job listings, we also call potential applicants’ attention to the wide variety of development opportunities at TÜV Rheinland through part-nerships with schools, open house events, and guided tours through our facilities. In addition, social networks are becoming an increasingly important recruiting tool, especially when it comes to young people.

We are convinced that talent and motivation are not expressed through good grades or a spotless record alone. That’s why we also gladly give people consideration who, for a variety of reasons, are unable to submit an immaculate résumé. These applicants are given the oppor-tunity to demonstrate their dedication and practical skills during an assessment day, for example, which in addition to an aptitude test represents a newer, yet fi xed component of our selection process. As a partner in the »Joblinge« initiative, we also want to enable select youth without a high school diploma to participate in a vocational training program. In this context, the idea is that experienced employees act as mentors to closely support and advise them in their professional and personal development.

With extensive contacts to universities and col-leges – particularly in North Rhine-Westphalia – we are also considered an attractive employer among young academic professionals. We provide guided tours and lectures, take part in subject weeks, invite students to take part in the Night of Technology in Cologne, offer specialized internships, and supervise project assignments and bachelor’s and master’s degree theses. The internships abroad that we offer are also very attractive to students. Contacts estab-lished in one of these ways frequently lead to an employment contract later on.

In cooperation with the Südwestfalen Univer-sity of Applied Sciences, the TÜV Rheinland Academy offers part-time degree programs in mechanical and electrical engineering. In fact, we are fully fi nancing the entire degree program for fi ve employees through scholarships. As a part of the NRW Scholarship Program, we also provide funding for students at the University of Cologne, the Cologne University of Applied

Sciences, the Bonn-Rhein-Sieg University of Ap-plied Sciences, and the Hochschule Niederrhein University of Applied Sciences in Krefeld.

We are also conducting two projects in coop-eration with the NRW Sports Foundation. As part of the »Coach the Coach« initiative, we brought together sports coaches and represen-tatives from the company for the fi rst time for an inspiring exchange of ideas in 2012. And the »Twin Career« initiative is geared toward a very specifi c audience, namely competitive athletes. Through internships and ongoing personal as-sistance and advice, we offer aspiring Olympic athletes the ability to establish a professional career early on. In this context, the athletes can gain a closer look at the professional world without it having a negative affect on their training. In addition, we have also supported the German Sport University Cologne since 2012 by making internships at our company available to the university’s students.

MOBILITY IS ATTRACTIVE

Our experience from countless hiring and em-ployee interviews has shown that job fl exibility is an extremely important criterion for many people when selecting an employer today. As a result, our goal is to give every employee as much fl exibility as possible within the scope of our management needs so that they can best coordinate their professional and private obliga-tions to their current phase of life and/or living situation.

By doing so, we not only increase our employ-ees’ job satisfaction and motivation, but also the profitability of our company as a whole. Because every time we need to refi ll a position, every longer period of absence, and every time we need to reintegrate returning employees entails signifi cant costs, effort, and – in most cases – a loss of knowledge for TÜV Rheinland. There are no steps we can take to completely prevent them, but we can at least reduce them considerably.

In 2012, we established an internal social ser-vice as its own independent department, and it acts as the main point of contact for issues

58


FAMILY AND CAREER

Our Social Services depart-

ment is responsible for a

range of topics – the »Family

and Career« program, with

its numerous new initiatives,

and measures to prevent

serious illnesses are two good

examples.

pertaining to work–life balance. Through full-time support of the »Family and Career« pro-gram and a number of different new initiatives, this department coordinates and develops ways to become familiar with the true needs of the company’s employees and offers services that are tailored to these needs.

Within the scope of this program, we offer our employees a variety of different measures such as fl extime schedules, telecommuting and part-time work during parental leave, opportunities to stay in contact, and spots for children in day-care centers. One issue that is becoming increas-ingly important is caring for family members. We must prepare for the fact that over the long term, a signifi cant number of our employees – especially in Germany – will exercise their legal right to take leave to care for loved ones.

GOOD HEALTH BEGINS IN THE MIND

Permanently maintaining our employees’ health, productive capacity, and quality of life is of utmost concern to our company. Through the aforementioned Social Services department, we have further increased the effectiveness of our workplace health management. This is be-cause it is initially important, in many cases, to create suffi cient awareness of health risks. Our employees can then counteract them with a wide range of preventative measures. Our mea-sures to increase awareness in the reporting year included, among other things, working with a health coach and numerous health days in our German Operations and subsidiaries.

As has long been the tradition, in Germany we once again offered infl uenza vaccinations in 2012, which 577 employees took us up on. Other preventive measures relate to modern ailments such as lung cancer, weight problems, back pains, and diabetes. In addition, we also took measures that are tailored to fi t the special needs of specifi c careers – employees who drive a vehicle as part of their work, for example, are offered a corresponding eye exam, while em-ployees who work at computer screens are enti-tled to a checkup in accordance with computer workplace regulations.

Last but not least, a healthy way of life includes a balanced diet and suffi cient exercise. As a re-sult, when carrying out promotional activities, we are increasingly moving away from offering sweet calorie bombs and instead provide fruit. And in 2012, we showed our employees how to quickly convert an offi ce into a gym within the scope of our »Sport in the Workplace« training program. In Germany, our extensive company sports program, which includes around ten dif-ferent athletic disciplines, is complemented by about 20 to 25 special sports projects – includ-ing sailing tours, ski trips, and charity runs.

But even the best occupational health manage-ment will never fully prevent individual em-ployees from being forced to leave their job as a result of disability. In 2012, we began offering our employees in Germany disability insurance coverage, where we bear half the cost of the pre-miums. As a result, we play an important role in at least partially eliminating income shortfalls in the event that an employee should become disabled.

WE PLAY IT SAFE

Ensuring the health and safety of our employees while they do their work is our highest priority at all times. That is why our occupational safety management system applies to all companies across Germany and is part of our integrated ISO 9001:2000-compliant management system. As an independent management system, it is also certifi ed pursuant to OHSAS 18001 for nu-merous German companies. Incidentally, we are also accredited certifi ers of occupational safety management systems ourselves.

The core of our system is the Occupational Safety Management (OSM) Guideline, which we have augmented with subordinate guidelines, process descriptions, and forms. Responsibility for developing and administering this system rests with the Group’s full-time Occupational Safety and Radiation Protection Offi cer. To ac-count for the fact that the content and orga-nization of occupational protection and envi-ronmental protection management systems are steadily becoming more intertwined, we began

Responsibility

Employees 59


ASSESSMENT

In Germany alone, a total of

35 occupational health and

safety committees review the

effectiveness of occupational

health and safety measures.

combining the two into an integrated HSE (Health, Safety, and Environment) management system in 2012. In the future, this system will also form the basis of the HSE organization at our foreign subsidiaries. A further focal point of our work in the reporting year was on develop-ing key performance indicators to evaluate our performance in the fi eld of occupational health and safety.

Effi cient occupational health and safety mea-sures require prior knowledge of the potential hazards specifi c to an individual activity. Only then can we determine which measures – such as briefi ngs, personal protective equipment, and occupational medical checkups – are required in each individual case. In 2012, we laid the groundwork for the introduction of a database which, starting in 2013, should help us record hazard evaluations that we have conducted in a structured way and make them accessible throughout the group.

In Germany, we evaluate the effectiveness of our occupational health measures using, among other things, a network of 35 German Opera-tions-related occupational safety committees (OSC) that meet four times a year. All of our employees in Germany are represented by these committees.

More than 89% of our employees in Germany have been personally briefed at least once on the specifi c hazards that lie within their area of activity. In the future, we also want to comple-ment personal conversations with self-teach-ing programs, which will further increase the reach of our briefings. In the reporting year, we completed important preliminary work in this regard, and have already progressed to the implementation stage.

In 2012, in contrast, our new IT-based accident notifi cation system was successfully launched. This system is used to systematically record occupational accidents and accident-related downtimes in Germany using standardized cri-teria. We will progressively implement the sys-tem at our foreign subsidiaries as well. In 2012, our foreign subsidiaries reported a total of 123 injuries (accidents).

Occupational Safety in Germanyin terms of reportable accidents

2011 2012

Number of employees covered in % 100 100

Accidents 135 140

Accident rate* 11.76 11.75

Days lost due to accidents 2,120 2,607

Days lost due to accident per accident 15.7 18.62

* Occupational accidents per 1,000,000 working hours.

60


ENVIRONMENT

KNOWLEDGE PROTECTS – EVEN THE ENVIRONMENT

Our experts around the world utilize their com-prehensive technological expertise to develop solutions that, among other things, minimize negative environmental infl uences in many ar-eas of our life, and help to make them control-lable. In this process, we act in a close dialogue with partners from the worlds of research, poli-tics, civil society, and industry.

To account for the fact that the content and or-ganization of occupational protection and en-vironmental protection management systems are steadily becoming more intertwined, we began combining the two in 2012 into an inte-grated HSE management system. HSE stands for health, safety, and environment – an indication that we are vigorously striving to integrate our processes from both a technical and interdisci-plinary perspective. Accordingly, the integrated management system should in future also form the basis of the HSE organization at our foreign subsidiaries. Additions specifi c to the individu-al country will ensure that the respective local laws are observed.

In 2012, we once again hired an external ap-praiser to certify the quality management of a large portion of TÜV Rheinland companies with more than 50 employees pursuant to ISO 9001 within the scope of a Group certifi cation. At the end of 2012, in addition to our fi ve certifi able German Operations – as a company that itself issues certifi cations, the German Operation Sys-tems is prohibited from being certifi ed by an external company – the following countries in our Group’s regions have already been certifi ed:

p Western Europe: Spain p India, Middle East, Africa: India,

Saudi Arabia, United Arab Emirates p Asia Pacifi c: Indonesia, Japan, Malaysia,

Philippines, Singapore, South Korea, Thailand, Vietnam p Greater China: China (mainland),

Hong Kong, Taiwan, and four other Chinese subsidiaries p North America: USA

Furthermore, additional German and interna-tional companies in the Group have also been certifi ed outside of the Group certifi cation by various certification companies pursuant to ISO 9001. In 2012, we generated approximately 80% of total turnover in certifi ed companies. We are convinced that through the continued harmonization of our quality management sys-tems, we will simplify our international collabo-ration and increase the effi ciency of our pro-cesses. The certifi cation of additional companies in the Group is planned for 2013.

At the same time, we will also have our environ-mental management systems certifi ed pursuant to the international standards ISO 14001 and OHSAS 18001. In 2012, our two Spanish compa-nies, TÜV Rheinland Iberica S.A. and TÜV Rhein-land Navarra S.A., were both certifi ed in accor-dance with ISO 14001.

In addition to the Group Offi cer, two HSE man-agers and five environment management of-fi cers were active in Germany in 2012. This is how we implemented the organizational struc-ture with regard to HSE with the six German Operations and our administrative divisions. They monitor the observation of our Environ-mental Protection Guideline, promote ecologi-cal awareness among our employees, and ensure that neither the law nor valid environmental regulations are violated. We are not aware of any such breaches internationally in the report-ing year.

SMALL IMPROVEMENTS ADD UP!

As a service provider, our direct environmental impact – compared to manufacturing compa-nies – is relatively moderate. Our impact mainly stems from the use of our offices and testing facilities as well as from business travel.

Nevertheless, we do not believe this limits the role we can play in protecting the environment. As a result, we have set the goal of reducing our specifi c CO2 emissions by 25% from their level in 2010 by the year 2020. We also want to re-duce our energy use per employee in Germany by 20% during the same period. In order to achieve these goals, it is critical that we increase all of our employees’ awareness of the fact that

Responsibility

Environment 61


2011 2012

Natural gas

Heating oil

District heating

Electricity (real estate)

Energy Consumption in Germany in MWh

26,88127,132

7,6289,841

11,84413,293

34,50038,291

Car

Airplane

Rail

Business Travel in GermanyEmissions in metric tons of CO2

9,11210,158

1090

5,0133,472

2011 2012

CO2 Emissions in Germany

in t 2011 2012

Natural gas 5,376 5,426

Heating oil 2,012 2,596

District heating 3,186 3,576

Electricity

(real estate) 22,185 24,653

CO2 Emissions

in 1.000 tons of CO2 2011 2012

Total 101 95.9

directly 51 36.7

indirectly 50 59.2

Germany 47 49.9

directly 21.5 21.7

indirectly 25.5 28.2

in metric tons of CO2 per employee

Ger

man

y

Cen

tral

Eas

tern

E

uro

pe

Asi

a Pa

cifi

c

Gre

ater

Ch

ina

Ind

ia, M

idd

le

Eas

t, A

fric

a

No

rth

Am

eric

a

So

uth

Am

eric

a

Wes

teu

rop

a

4.26

4.27

5.49 5.

74

2.6

6.30

2.38 2.

67

0.47

0.34

1.89

1.48

3.29 3.

50

1.93

1.96

Real Estate Electricity Consumptionin metric tons of CO2

Ger

man

y

Cen

tral

Eas

tern

E

uro

pe

Asi

a Pa

cifi

c

Gre

ater

Ch

ina

Ind

ia, M

idd

le

Eas

t, A

fric

a

No

rth

Am

eric

a

So

uth

Am

eric

a

Wes

teu

rop

a

2,88

03,

673

13,2

0515

,731

494

3,65

0

1,00

01,

405

1,32

41,

1002,29

63,

125

797 1,37

2

24,6

5322

,185

2011 2012

CENTRAL ENVIRONMENTAL DATA

Reduced CO2 emissions as a result of direct energy use

can partially be attributed to the modernized fleet of ve-

hicles. The use of district heating, natural gas, and heating

oil is not incorporated into the calculation for our foreign

subsidiaries.

The stated levels of CO2 emissions from the use of proper-

ties and from indirect emissions are both highly contin-

gent on the changes to data collection.

The increase in electricity use is primarily the result of a

change to data collection methods which put more weight

on the large and more electricity-consuming laboratories

and/or locations.

Once again in 2012, the lion’s share of business travel in

Germany was by car (59 million kilometers compared to

51 million kilometers in 2011). Specific CO2 emissions per

vehicle declined significantly, however.

The growth in China can be attributed to the strong growth

of our business there. The significant increase in the re-

gion India, Middle East, Africa resulted primarily from the

operation of a newly constructed photovoltaic laboratory

in India.

When it comes to specific CO2 emissions in the region

India, Middle East, Africa, the impact of the new photovol-

taic laboratory is particularly significant.

62


MODERNIZING BUILDINGS

In 2012, we invested 3.1 mil-

lion euros in environmental

protection.

TÜV Rheinland Environmental Performance per Employee*

Germany 2011 Germany 2012 Global 2011 Global 2012

CO2** t 6.94 7.09 6.33 5.57

Energy** MWh 32.5 33.3 26.9 23.92

Business travel km 11,499 13,000 14,956 10,910

Paper kg 61.3 55.7 41.7 37.9

Water l 17,480 18,671 15,380 16,404

* Full-time equivalent.

** District heating, natural gas, and heating oil are not incorporated into the calculation for our foreign subsidiaries.

together, many small improvements can add up to a respectable contribution to improving our environmental performance.

In 2012, we once again initiated and/or enhanced measures and projects both across the Group and at the local level in order to improve our energy effi ciency and cut our greenhouse gas emissions. Expenditures and investments in this context were primarily focused on:

p Using more energy-effi cient technology to run our buildings p Avoiding or at least reducing business travel p Reducing fuel consumption and emissions

through the use of more fuel-effi cient com-pany cars p Using state-of-the-art technologies to operate

our IT centers, testing labs, and facilities

At the present time, our most comprehensive individual measure is the modernization of the TÜV Rheinland House (known as the »T-Bau«) at our headquarters’ grounds in Cologne, a building complex comprising three tracts that was built in the late 1960s. By completing the renovation of tract B’s roof areas and facades in the reporting year, we have now updated all three tracts to a contemporary level as far as en-ergy effi ciency is concerned.

The fi nal measure to improve energy effi ciency will be completely modernizing the entire heat-ing supply system of the building complex, and the planning in this regard has already begun.

Furthermore, we also implemented measures to reduce the energy required for heating at oth-er German locations in 2012. Our budget for building renovations in Germany, particularly for renovating facades and windows, totaled 3.1 million euros in the previous business year.

2012 ENVIRONMENTAL PERFORMANCE

When considering the key environmental vari-ables, in 2012, TÜV Rheinland’s performance per employee was as set forth in the following table.

According to our calculations, in the 2012 busi-ness year, we generated 96,000 tons (previous

year: 101,000 tons) CO2 emissions across the

Group as a result of our business operations. This calculation does not include district heat-ing, natural gas, and heating oil used by our for-eign subsidiaries. Of this total, 59,000 tons (pre-vious year: 50,000 tons) of CO2 was produced as a result of using indirect energy sources (elec-tricity and district heating) at our properties. About 37,000 tons (previous year: 51,000 tons) of CO2 was emitted as a result of consuming di-rect forms of energy – natural gas, heating oil, or fuel – used for heating and business travel by car or airplane. In contrast to 2011, both na-tional and international commuter travel is not factored into this calculation.

ENERGY

Direct sources of energy include fuel, natural gas, and heating oil. In contrast, electricity is considered an indirect source of energy. We use electricity to operate computers, lighting, and our technical systems. We buy district heading from local utility companies. Due to our global presence, we assume that TÜV Rheinland’s elec-tricity mix is comparable to the general electric-ity mix of the respective country. As a result, we also drew upon the recognized »GaBi« database in 2012 to incorporate national and local ener-gy mixes into our calculations. TÜV Rheinland does not produce any energy of its own.

Responsibility

Environment 63


A GREEN CONSCIENCE

Per ton of CO2 emissions

saved, AMD will plant

30 trees as part of »Plant

for the Planet.«

With regard to the locations being examined, in 2012 power consumption in Germany – in-cluding power used for heating – is projected to total around 38,300 megawatt hours (pre-vious year: approximately 34,500 megawatt hours [MWh]). The power consumption for all of the Group’s properties is projected to total 71,400 MWh (previous year: 62,000 MWh). In contrast to total projected consumption, the na-tional energy mix used by the locations in the region was incorporated into the projections for the individual regions, as a regional comparison is more accurate.

WATER

We have set the goal of steadily reducing our water consumption and improving the quality of the wastewater that we generate. The corre-sponding measures form an integral part of our environmental programs.

In 2012, we used 90,000 cubic meters (previous year: 98,000) cubic meters of water from the lo-cal water system at the properties in Germany

which we analyzed. This water is from local surface and groundwater reservoirs and is used for standard purposes – for example, in bath-rooms, for cleaning purposes, and in the caf-eteria. Extrapolating this fi gure to all our Ger-man locations results in a water consumption of approximately 131,350 cubic meters (previous year: approximately 118,000 cubic meters). This corresponds to 18,700 liters per employee in the reporting period (previous year: 17,500 liters).

MATERIALS

Since our business activities do not involve producing or processing raw materials or semi-finished products, we do not keep records of the materials we use by weight and volume. One exception to this is the paper we order, the amount of which we regularly record.

According to our records, we purchased a total of 392 tons (previous year: 415 tons) of paper in Germany in 2012. The standard paper we use is »Multi Copy,« a paper from sustainable forests that is FSC-certifi ed.

AN EXTREMELY SPECIAL DIET

Meals and business travel have one astound-

ing thing in common – the people taking part

in them are not conscious of how many calo-

ries they are consuming or emissions they are

creating, respectively. That is why in 2012, the

environmental management officer from our

subsidiary AMD launched a direct awareness

campaign called »AMD TÜV Arbeitsmedizinische

Dienste GmbH is shedding the CO2 kilos.« Using

basic sample calculations, he clearly showed his

colleagues how many kilometers and CO2 emis-

sions could be saved through the increased use

of telephone and video conferences instead of

traveling. In addition to the unquestionably ab-

stract benefit to the environment, he also em-

phasized the truly tangible benefits to the indi-

vidual employees: no more tiring travel days,

more time to actually work, and the bottom line

– noticeably less stress. An incentive that, in fu-

ture, should increase employees’ appetite for

video conferences in other Business Streams.

64


FLEET CONSUMPTION

We have set the goal of

cutting the specific fuel con-

sumption of our company’s

fleet of vehicles by 3% com-

pared to the previous year.

MOBILITY (BUSINESS TRAVEL AND COMPANY CARS)

Our sales activities, the countless number of jobs completed on-site at our clients’ premises, and the increasingly international structure of our Group make business travel necessary. Wherever possible, however, we try to reduce our travel or to switch to more environmen-tally friendly means of transportation. The cor-responding environmental criteria are an inte-gral part of our business travel policies. We are making increased use of telephone and video conferences to replace events held in person – particularly those that would otherwise require air travel.

We estimate that in 2012, our employees logged approximately 59 million kilometers (previous year: 51 million kilometers) of business travel by car (either company car, rental car, or private car). This calculation continues to be based on the assumption that the employees that have access to one of our leased vehicles use their company car about 70% of the time for busi-ness purposes. Our roughly 1,130 leased cars (previous year: 970 cars) in Germany accounted for an estimated 26.8 million kilometers of the aforementioned total (previous year: 20.8 mil-lion kilometers). For these business trips, our employees used an estimated 1.8 million liters of fuel (previous year: 1.4 million liters).

By issuing a new policy governing company cars which, for the fi rst time, contained a CO2 emissions criterion for the different vehicle classes, we set the goal in 2011 of cutting the specifi c fuel consumption of our fl eet of com-pany cars in Germany by 3% each year com-pared to the year prior. Through the use of the fl eet management database »Speedfl eet,« which we fi rst began using completely in 2011, we can clearly demonstrate that we achieved this goal in 2012. While average fuel consumption across the entire fl eet totaled nearly seven liters per 100 km in 2011 (equal to 182 grams of CO2 per kilometer), in 2012 we succeeded in reducing consumption to 6.6 liters per 100 kilometers (equal to 173 grams of CO2 per kilometer) – a reduction of almost 5%.

NEW MOMENTUM FOR TÜV RHEINLAND

If at some point we decide to write down

our success story in the field of wind

power, 2012 will play a key role – with

good reason. Or better said, with two

good reasons.

Because after two years of intensive

preparations, we were recognized by the

Deutsche Akkreditierungsstelle (German

Accrediting Body) as a certifying orga-

nization for wind power systems – cer-

tifications pursuant to the international

IEC 61400-22 series of standards. As a

result, we are now not only limited to

conformity evaluations of onshore and

offshore wind power systems and their

components, but can also issue the cor-

responding internationally recognized

certifications. This opens up a wide range

of new business opportunities for us, par-

ticularly abroad.

In addition, our strategic partnership with

EuroWind, an innovative company for

wind and energy yield reports, increases

the attractiveness of our portfolio of

services for international wind power

projects even further. With its internal,

highly adjustable method of calculation,

EuroWind is considered an expert when

it comes to long-term energy yield fore-

casts, particularly with regard to offshore

systems. As one of the market leaders for

short-term wind power forecasts across

all of Europe and China, our new partner

also plays a key role in optimizing the

integration of renewable energy sources

into the power grid. We are certain that

by pooling our strengths, we can signifi-

cantly expand our position in the future

market of wind power.

Responsibility

Environment 65


Our German employees logged approximately 26.8 million kilometers on business trips by air (previous year: 22.6 million kilometers). This fi gure includes both domestic and international fl ights. Taking our international companies into account, we recorded a total of 88.6 million ki-lometers traveled by air in the reporting year (previous year: 83.3 million kilometers traveled by air). The decline in CO2 from air travel in 2012 is largely due to adjusting the CO2 conver-sion factor for fl ights from 346 grams per mile

to 240 grams per mile. By making this adjust-ment, we are now using a standard conversion factor that was provided to us by our travel agency. In contrast, airlines continue to calcu-late kerosene consumption per kilometer fl own at extremely different rates. For the purposes of comparison, in 2012 we settled on a realistic average consumption of 0.05 liters of kerosene per person (previous year: 0.07 liters). On this basis, our kerosene consumption in 2012 totaled about 4.4 million liters across the Group (previ-ous year: 5.9 million liters).

Our employees traveled approximately 5.9 mil-lion kilometers (previous year: 4.8 million kilo-meters) long-distance on Deutsche Bahn trains. In doing so, they consumed 388 MWh of elec-tricity (previous year: 313 MWh). We continue to take part in Deutsche Bahn’s bahn.corporate »Umwelt-Plus« service, meaning that all busi-ness trips with Deutsche Bahn in 2012 were climate- and CO2-neutral.

WASTE

Relevant quantities and more signifi cant types of waste mainly accumulate at just a few main locations, where they are recorded by either quantity or weight. At the smaller locations, or-dinary business waste and used paper is disposed and recycled within the scope of the public gar-bage collection. We do not record the quantity of waste that accumulates at these locations. We can only estimate an amount based on the num-ber of containers, their volume, the collection schedule, and average density of a full container.

All of our German Operations and all of our em-ployees are actively involved in separating all waste by type. We increase our employees’ aware-ness in this regard through systematic awareness training programs. In 2012, for example, we once again reminded the employees at our headquar-ters in Cologne of the importance of carefully separating waste and selecting paper.

Commercial waste, general trash, special waste, and recyclable materials are immediately sepa-rated upon accumulating. Waste disposal is handled exclusively by regional waste disposal companies and – in the case of hazardous waste – by certified companies that specialize

FOOD FOR THOUGHT

The facts have never been more clear – over

the long term, Germany will not play a sig-

nificant role as a manufacturing market for

solar panels. Does that mean it is time to

start writing the German solar industry’s

obituary? Not at all! With its powerful re-

search and development, Germany can take

on the role of a global pioneer in the field of

photovoltaics in the future. The goal here is

to develop practical, mass-market solutions

for integrating photovoltaics into intelligent

power and storage systems for buildings.

And we should not forget another point –

with about 1.4 million systems in use, Ger-

many is currently the largest test market for

the practical application of photovoltaics. In-

stead of exporting panels, we need to export

expertise. Expertise in quality assurance.

Expertise when it comes to the permanent,

reliable operation of solar power systems.

Without quality, the solar industry will not

be able to develop in a sustainable manner,

because people only invest in quality, and

only quality can be insured at reasonable

terms. The associated market potential for

SMEs, planning offices, and testing service

providers like TÜV Rheinland is enormous.

It is time for a German solar revolution. And

we are ready!

66


5

4

2

1

3

1.6

2.4 2.4

1.9

2.0 2.1

Exp

erti

se

Inn

ovat

ive

off

ers

Flex

ibili

ty

Rel

iab

ility

Su

pp

ort

Ove

rall

sati

sfac

tio

n

Customer Satisfaction Survey in 2012Illustration of selected criteria

(1) very good (2) good (3) fair (4) poor (5) very poor

Evaluation scale

TÜV Rheinland Industrie Service GmbH

in hazardous waste and do not, as far as we are currently aware, conduct international business and therefore do not dispose of special waste by sending it across borders. For the most part, the only hazardous waste that accumulates con-sists of old computer monitors, other electronic waste, and used chemicals. Certifi ed waste dis-posal companies collect electronic scrap for disassembling and recycling. Other hazard-ous waste accumulates only in small quanti-ties and is handled properly by waste disposal companies.

Waste disposal and adherence to applicable laws, provisions, and regulations is coordinated and monitored by our environment management of-fi cers and/or the HSE managers in the individual German Operations. They are assisted in this task by additional local employees.

In the course of our ordinary business activities, we do not generate any further signifi cant waste other than our documented waste, emissions, and wastewater. Waste in Germany*Key locations

in t 2011 2012

Waste for recycling** 715 734

Paper** 514 435

Metal 117 98

Wood 146 99

Construction waste 200 143

Separator content 20 33

Electric/Electronic waste 48 42

Other hazardous waste 13 15

* These figures are partially based on assumptions and

contain estimates.

** These figures are based on the stated volume of waste

containers from 2010 and were not weighed specifically.

SOCIETY

IF YOU DON’T ASK, YOU’LL NEVER ... MOVE AHEAD

In order to make continuous advancements and meet the needs of our customers, TÜV Rhein-land regularly communicates with this impor-tant stakeholder group. When our customers are satisfi ed, we have achieved one of our most important corporate goals. If we receive critical feedback from customers, it is a clear signal that there is room for improvement somewhere in our business activities or in our processes. In the end, a constructive dialogue with our cus-tomers is always benefi cial. That is why we also systematically look to enter into a dialogue with customers outside of our daily operations – such as in the form of comprehensive surveys that almost all of our German Operations conduct every two years. These surveys not only help us identify areas with room for improvement in our respective business activities and decide on actions to take, but are also always an impor-tant source of inspiration for new product and service concepts.

Responsibility

Society 67


NEW TEST MARK

Find out more about our new

test mark on page 28 of this

report.

The most recent customer survey conducted by the German Operation Industrial Service dem-onstrated that, as was the case previously in 2010, we are in a good place when it comes to expertise and reliability. Our customers do see room for improvement in terms of a fl exible se-lection of our services and a range of innovative product solutions.

Customer satisfaction and trust in our com-pany is increasingly becoming dependent on the security of their often highly sensitive data. In order to guarantee constant, comprehensive data and information security, we have estab-lished binding basic rules and guidelines that apply across the Group. These contain strict requirements regarding the use of IT and com-munications technology devices as well as the collection, processing, and use of personal data. In addition, thanks to the Group company TÜV Rheinland i-sec, we have a team of qualified data protection specialists in-house that pro-vide our customers with personal, competent support.

Our brand strategy and corporate identity are two additional factors that infl uence how third parties view our company. That is why both ar-eas are managed centrally at TÜV Rheinland. We regularly analyze our brand awareness using rep-resentative surveys. According to these surveys, TÜV Rheinland is the best known of the three large major TÜV organizations in Germany.

NEUTRAL OPERATIONS – POSITIVE EFFECTS

We can honestly say that inspecting the effects of products and services on health, safety, and the environment is our core area of expertise. In some of the testing services offered by TÜV Rheinland, we have more than a century of ex-perience. This has allowed us to perfect these services when it comes to adhering to standards to protect health and safety.

In contrast to manufacturing companies, con-ducting valid »impact assessments« of our prod-ucts in relation to the environment, health, and society is a signifi cantly more complex process. Despite this diffi culty, we go to great lengths to tailor our processes to be as environmentally friendly as they are socially responsible – and in doing so, we reduce the harmful effects of our business operations to an absolute mini-mum. This is refl ected, among other areas, in our ambitious goals when it comes to cutting our emissions and energy consumption and our efforts to reduce the amount of business travel through the increased use of remote assistance and e-learning services as well as video confer-ence centers.

A NEW SIGN OF TRUST

Product labeling requirements or laws govern-ing the usage of our products largely do not apply to our testing, training, and consulting services because the result of our testing is usu-ally a seal, certifi cate, or expert report with no socio-ecological effects of its own. That said, the awarding of these seals, certifi cates, and expert reports is itself subject to high standards, legal requirements, and regional and/or industry-spe-cifi c safety and functional standards, as well as current research fi ndings. We are only allowed to undertake many of our tests after acquiring a certifi cate of competence and after regular in-spections by an accreditation body.

In order to ensure that we adhere to all the ap-plicable standards and guarantee the integrity of the services we provide, we implemented a comprehensive compliance system early in our company’s history. And our new test mark can play an important role in better protecting con-sumers, because beginning in 2013, TÜV Rhein-land will only issue one mark for every type of test conducted worldwide. In addition to its un-mistakable appearance, new features will guar-antee maximum transparency – for example, a QR code which leads to our Internet platform Certipedia will allow consumers to be absolutely sure of the validity of the statement the mark is making within a matter of seconds.

68


PPP

stands for public-private

partnership projects. We are

involved in development

partnerships with organiza-

tions such as the German

Investment and Development

Company (DEG).

TOGETHER, WE CAN ACHIEVE MORE

All over the world, public-private partnership projects have proven to be an effective instru-ment in achieving goals related to development policy. These projects create jobs, improve pro-duction processes and living conditions, and open doors to badly needed technologies. PPP projects’ recipe for success is as simple as it is effective – you take the best from each individ-ual part! Because when several strong partners combine their individual strengths, they can do great things.

We are involved in various PPP projects in de-veloping and transition countries together with non-profi t organizations or public development agencies, such as the German Investment and Development Company (DEG). In this context, we contribute our technical expertise on our own behalf to do our part for social progress. Our partner organizations then monitor wheth-er the progress we were striving for is actually achieved and maintained.

HELPING WITH COMMON SENSE

Another aspect of our corporate citizenship activities is supporting philanthropic projects. Due to the enormous range of initiatives that deserve support, deciding on a specifi c area of support is anything but easy. That is why it is important to us that the projects we sponsor are a good match – namely, that they embody the values we represent, are closely linked to our business activities, or are established in our lo-cations’ local environment or markets. We like to be active in areas that are related to the UN Global Compact’s ten principles and support local social and cultural projects.

We take projects and activities into consider-ation that:

p Promote education and science p Improve people’s living conditions or help

to guarantee their survival p Serve to safeguard aid and disaster-relief

services

We usually cooperate with non-profi t aid orga-nizations when carrying out our activities. In this context, we want to stress the organization Engineers Without Borders. This organization plans its own technical aid projects and carries them out locally, supports other aid organiza-tions and those in need by providing knowledge to overcome problems of an engineering nature, and conducts research and explanatory work in the fi eld of sustainable technological develop-ment. We explicitly encourage our employees to volunteer in one of the organization’s many regional groups and use their knowledge and time in service of a good cause. In addition, we have provided fi nancial support to Engineers Without Borders for many years now.

As part of another long-term initiative launched by Germany’s Ministry of Foreign Affairs and the Asia Pacifi c Committee of German Business, since 2008 we have been involved in rebuilding schools in several Chinese provinces that were severely affected by strong earthquakes. Our focus is currently on Yunnan province, where we are helping to reconstruct school buildings in danger of collapsing. After an approximately one-year construction phase, in December 2012 we were able celebrate the reopening of not one, but two schools. We provided a total of 240,000 euros for the construction work over a two-year period that concluded at the end of 2012.

Our sponsorship of the Thimmaiah Reddy School in the Indian metropolis of Bangalore is still comparatively new, yet also has a long-term focus, with a time frame of fi ve years. The con-struction of bathroom and drinking water facili-ties and classrooms is already in full gear, as our Chief International Offi cer Stephan Schmitt was able to see for himself during his visit in Octo-ber 2012. He also used the opportunity to open a brand-new »Medical Camp« that provides medical services free of charge to the students. In addition, we want to help create a peaceful and productive learning environment by donat-ing books and providing security personnel.

Responsibility

Society 69


From Opening Doors ...

REACH: these five simple letters pose a sig-

nificant challenge even for leading chemical

companies. Successfully meeting the require-

ments of this European regulation governing

the registration, evaluation, and authorization

of chemicals is anything but a walk in the park.

Without expert assistance, it is an almost in-

surmountable obstacle for the countless small

manufacturers of leather goods and home tex-

tiles as well as their suppliers in the Indian state

of Tamil Nadu.

Together with the German Investment and De-

velopment Company (DEG), a team from TÜV

Rheinland provides exactly this much-needed

assistance locally within the scope of a PPP

project. Our initial task in this context was con-

veying basic knowledge about REACH and its

potential effects on the competitive ability of

the affected companies. A total of 37 trainers,

who we had trained to carry out compliance

management training seminars, acted as key

communicators in this regard. In comprehen-

sive training seminars, our experts got the can-

didates fit for REACH and, in doing so, ensured

that the door to the important European mar-

kets remains open.

The Indian electronics industry and its suppliers

know similar problems all too well. Their major

challenge goes by the name HSPM – Hazardous

Substance Process Management. Even in the

purported technology capital of Bangalore and

the metropolis Chennai, many companies are

lagging far behind the international standards

for handling hazardous substances. Changing

this fact was the goal of another PPP project in

which we participated in 2012.

The foundation of our work was a stakeholder

roundtable, which not only provided us with

valuable data on companies and their current

level of compliance, but also a feeling for the

obstacles that particularly small companies are

facing when it comes to implementing contem-

porary HSPM standards. Increasing awareness

and providing information to as many affected

companies as possible was the focus of the sec-

ond phase of the project. In this case as well,

our extensively trained local key communica-

tors proved to be a valuable tool. But in India,

as is the case elsewhere, theoretical knowledge

is only half of the story. In the third phase of the

project, we proved that obstacles once believed

to be insurmountable could in fact – with the

right knowledge and the will to change – turn

ince and the Guangxi autonomous region. In this context, TÜV Rheinland not only provided offi ce space for the program, but also looked out for the physical well-being of the participants.

The Cologne Volunteer Days have also had a fi xed spot on our agenda for several years. In 2012, our employees had the ability to register for two very different projects: »Out of School – Into the Working World« and »Gardening in the City.« While in the former project, we gave

9 »P«s FOR A GOOD CAUSEDEVELOPMENT PARTNERSHIPS

No matter what region you look at, volunteer days at TÜV Rheinland companies are now more or less customary CSR practice. This also applies to our Greater China region, where in the reporting year a total of 85 employees par-ticipated in a tree-planting event and a public beach cleanup. In other cases, volunteer days quickly become volunteer weeks or even vol-unteer months. For example, a total of 14 em-ployees took part in two programs to provide advanced training to teachers in Sichuan prov-

70


students from various secondary schools the op-portunity to get a taste of our employees’ work-ing life in a variety of positions at TÜV Rhein-land as well as pick up some valuable tips for their own job applications, in the latter project our volunteers spent their time treating an area of a municipal garden in Cologne where the ground was contaminated with hazardous sub-stances. In keeping with the tradition of incor-porating our service expertise into the projects, we integrated an applicant training session and

out to be stepping stones. We selected ten com-

panies, and at the end of a period of intensive

preparation, they even passed a simulated audit

... to Opening Eyes

Whether economic growth or fighting poverty

– many Latin American countries have achieved

great success in recent decades. But unfortu-

nately, their environmental performance has

not kept pace with these other positive trends.

Changing this was the goal of a three-year part-

nership between local subsidiaries of the TÜV

Rheinland Group and university institutions and

government agencies. Equipped with the neces-

sary skills and tools, the goal for these partners

is to act as key communicators in the future and

support industries and municipalities in a vari-

ety of Latin American countries in implementing

social, cost-effective, and environmentally sus-

tainable energy and environment management

systems.

Our experts initially approached the task at hand

where it promises to have the greatest effect –

in energy-intensive industries like the oil and

steel industries, agriculture, and the building

sector. What are the features of an energy man-

agement system pursuant to ISO 16001? How

do you calculate a carbon footprint? What is

the meaning of the »Voluntary Gold Standard«?

These are all questions that interested compa-

nies receive competent answers to within the

scope of seminars and workshops, hopefully

motivating them to tackle specific projects. And

wherever people are talking about energy effi-

ciency, the topic of »renewable energy sources«

is of course not far behind. As a result, it repre-

sents the initiative’s second area of focus.

an occupational safety briefing, respectively, into the day’s activities.

Since 2009, we offer a forum for all of our em-ployees interested in volunteering so that they can discuss experiences working on projects with like-minded colleagues, propose new proj-ects, or fi nd inspiration for a project to get in-volved in themselves over an interactive online platform on our company’s intranet.

They passed the test: a total of 23 companies have successfully

implemented the REACH Compliance Management System.

Responsibility

Society 71


72


74 GROUP MANAGEMENT REPORT

74 HIGHLIGHTS

77 GENERAL CONDITIONS

77 Macroeconomic Developments in 2012

79 NET ASSETS, FINANCIAL POSITION

AND RESULTS OF OPERATION

79 Development of Revenues

81 Development of Income

82 Financial Position

83 Balance Sheet and Capital Structure

84 Investments

84 BUSINESS SITUATION

85 Industrial Services

85 Mobility

86 Products

87 Life Care

88 Training and Consulting

89 Systems

89 EMPLOYEES

91 RISK MANAGEMENT SYSTEM AND

CORPORATE GOVERNANCE

92 VALUE MANAGEMENT AND BUSINESS-

RELEVANT ENVIRONMENTAL AND SOCIAL

FACTORS

93 OPPORTUNITY AND RISK REPORT

95 OUTLOOK

95 Future Economic Conditions

96 TÜV Rheinland Group Forecast

97 EVENTS AFTER THE REPORTING PERIOD

98 CONSOLIDATED FINANCIAL

STATEMENTS

98 INCOME STATEMENT

99 BALANCE SHEET

100 CASH FLOW STATEMENT

101 STATEMENT OF COMPREHENSIVE INCOME

102 STATEMENT OF CHANGES IN EQUITY

104 NOTES TO THE CONSOLIDATED

FINANCIAL STATEMENTS

104 GENERAL INFORMATION

114 NOTES TO THE INCOME STATEMENT

118 NOTES TO THE BALANCE SHEET

128 OTHER DISCLOSURES

140 AUDIT OPINION

141 CORPORATE BODIES

73


Financial Report

Detailed Index

HIGHLIGHTS

p The TÜV Rheinland Group successfully con-cludes the business year 2012 with record rev-enues. The Group continues to consolidate its market position after 140 years of company history, pursuing its course for the future as part of its newly defi ned »Strategy 2017«.

p The most important facts and fi gures for 2012

at a glance:

p Despite diffi cult economic conditions, revenues, including inventory changes, grows by 8.1% from €1,417 million to €1,531 million.

p Earnings before interest and taxes (EBIT) reaches €113.2 million (previous year: €124.0 million).

p Earnings before tax (EBT) are €94.1 mil-lion (previous year: €103.6 million).

p The profi t margin is 6.1% (previous year: 7.3 %).

p International sales in 2012 account for 50.6% of revenues; international employees for 59.5% of the Group’s headcount.

p In 2012, the mission statement and the busi-ness strategy were revised and adapted to fu-ture requirements.

In line with to the motto »About us«, the new mission statement describes the corpo-rate identity and the goals of TÜV Rheinland: »We want to be the world’s best independent provider of technical services for testing, inspection, certification, consulting, and training.« The mission statement creates an international framework for all employees, provides orientation for personal action, and represents the company’s culture and goals.

Additionally, Strategy 2017 has been defi ned, in which the orientation and company goals for the next few years are specifi ed. Profi table growth and consistent customer orientation make up the essential foundations: in the

next five years, TÜV Rheinland plans to ex-pand its employee headcount to 32,000 and to generate revenues totaling €2.7 billion.

Another important part of Strategy 2017 for the years to come is expanding the portfo-lio through value-enhancing acquisitions. Dr. Manfred Bayerlein emphasizes: »In the years to come, the focal points of our invest-ments will include industrial business. Pro-gressive industrialization in many developing countries will be an important driver of inno-vation. Additionally, we will invest in the ar-eas of further IT education and certifi cation.«

p In January 2013, TÜV Rheinland’s new test mark was offi cially introduced to the market. The test mark signals the highest quality in product testing, services, systems, and pro-cesses. It stands for the company as a whole. To achieve better recognition for customers and end consumers, the new test mark will be used in the future.

p International expansion – TÜV Rheinland continues to grow:

p An essential focus of growth in 2012 lies in the Training and Consulting Business Stream: on July 1, 2012, TÜV Rheinland Akademie GmbH took over the prestigious IT training provider the campus GmbH Center of Competence (Campus), with headquarters in Düsseldorf. The company, which was founded in 1984 and has over 100 employees at 19 sites, is among the larg-est providers of professional international IT training in Germany, with premium train-ing partnerships with well-known hardware and software providers, and conducts over 600 IT training sessions with more than 40,000 participants. In 2012, the campus contributes €10.1 million to consolidated revenues.

GROUP MANAGEMENT REPORT TÜV RHEINLAND AKTIENGESELLSCHAFT FOR 2012

74


In this connection, the integration of the business operations of e/t/s Didaktische Medien GmbH in February 2012 into the Training and Consulting Business Stream also deserves mentioning. The company, which specializes in complex electronic training formats, strengthens the strategic direction in the area of Workplace Learning Solutions.

With these targeted acquisitions, TÜV Rhein-land has made a meaningful addition to its training portfolio in the IT fi eld.

p Prof. Dr. Jürgen Brauckmann, Head of Ger-

man Operations Mobility, was unanimously

elected president of Société Européenne de

Contrôle Technique Automobile S.A. (SEC-

TA) at the Advisory Board meeting held in

April2012. At the end of 2011, TÜV Rheinland

had already acquired the majority of shares in

the French automobile administrator, which

is based in Courbevoie. As a result, SECTA

was already completely integrated into the

TÜV Rheinland Group from the second quar-

ter, and contributed revenues totaling €10.7

million.

The company, founded in 1992, operates a franchise partner network with 61 employ-ees, including over 800 automobile inspec-tion stations.

p In January 2012, TÜV Rheinland Rail Sci-ences, Inc. (RSI) took over the business op-erations of Rail Safety Consulting (RSC), which is based in Pittsford (New York/USA). RSI is one of the leading consulting fi rms in the rail industry, specializing in the use of highly analytical procedures for rail trans-port. The newly acquired company has the expertise to cover all relevant inspections on the topic of safety in rail transport. In 2012, RSC earned revenues of €2.2 million.

p At the beginning of the year, TÜV Rhein-land Cambodia Co., Ltd. with headquarters in Phnom Penh, the capital of Cambodia, was founded. The new company serves to acquire projects, observe the market, and develop market shares in Southeast Asia.

p In the business year 2012, TÜV Rheinland also expanded its international range of testing centers:

p In Japan, TÜV Rheinland founded a new testing lab for photovoltaic and energy stor-age systems with an investment volume totaling €4.5 million and 25 new jobs. The focus of the testing lab, which is located in Osaka and has 2,500 square meters of fl oor space, is testing rechargeable energy storage systems, such as lithium-ion batteries and super capacitors for various applications, as well as products in the solar technology fi eld. With this new testing lab, TÜV Rhein-land emphasizes its global investment strat-egy with regard to creating a comprehensive testing infrastructure for renewable energies such as solar, wind power, and fuel cells, as well as providing services in the field of electromobility.

p TÜV Rheinland responded to increasing de-mand from Turkish industry for quality and substance testing for export products with investments totaling €2.6 million. With 750 square meters of fl oor space, the new Soft-lines laboratory in Turkey has equipment for chemically testing inorganic and organic substances, for performing food contact tests, and facilities for testing textile proper-ties, colorfastness, and fl ammability.

p In March 2012, TÜV Rheinland opened its seventh testing lab for photovoltaic modules in Gyeongsan, South Korea. This laboratory is the fi rst one in South Korea that is oper-ated according to international standards. In addition to Yeungnam University, the Ko-rean Ministry of Knowledge Economy was also involved in its establishment. With in-vestments totaling €1.5 million, TÜV Rhein-land sets another milestone for developing its position as the worldwide industry leader in testing the safety of solar modules.

p With the opening of its new laboratory in

Gurgaon, India, TÜV Rheinland contin-

ued expanding its worldwide capabilities

for Softlines testing. The investment in the

75

Financial Report

Group Management Report

Highlights


laboratory, 1,500 square meters in size, was

about €1 million. An additional €1.5 million

was invested in laboratories in Bangalore and

Tiruppur. TÜV Rheinland’s global network

of Softlines laboratories now includes testing

facilities in nine countries and offers custom-

ers the benefi t of one-stop testing services for

global markets.

p To preserve the environment and resources

in terms of ecological sustainability and to avoid or reduce pollutants, TÜV Rheinland is involved in various projects:

p In January 2012, TÜV Rheinland founded its new service »Green Product Certifi cation.« The Green Product certifi cate represents an independent, voluntary certifi cation ensur-ing that various requirements in the area of sustainability are met. Certifi ed manufactur-ers can position their products as safe, sus-tainable, energy-saving, and environmen-tally friendly. The fi rst customers came from the IT sector. An expansion to additional products in the consumer goods sector is be-ing planned.

p In February 2012, TÜV Rheinland became one of the fi rst companies to sign the state-ment of conformity with the German Sus-tainability Code (DNK). The code includes 20 sustainability criteria with selected performance indicators on ecology, social aspects, and questions of company man-agement. With regard to these indicators, companies provide information about their sustainability strategies and goals, as well as existing rules, processes, and incentive systems for them. In addition, information on compliance with employee and human rights, the use of natural resources and eco-logical standards is required along the entire value chain. As a testing services provider, TÜV Rheinland claims to develop safe, eco-nomical, and sustainable solutions in co-operation with people, technology, and the environment.

p In June 2012, TÜV Rheinland Energie und Umwelt GmbH from the Industrial Services Business Stream was accredited by the Amer-ican National Standards Institute (ANSI) according to ISO 14065. The accreditation makes it possible to verify the greenhouse gas inventories from companies (known as corporate carbon footprints) and to validate and verify emissions reduction projects. TÜV Rheinland Energie und Umwelt GmbH is the first European company to receive this ANSI accreditation. With this action, TÜV Rheinland further develops its position in climate protection by adding an impor-tant service product.

p Strong population growth in São Paulo (Bra-zil) is overwhelming the city’s infrastructure. The result is informal settlements known as favelas, where difficult hygienic conditions prevail because there is no supply of water and electricity; waste disposal is also lacking. To raise the standard of living in the favelas, São Paulo’s city government initiated an ur-banization program (São Paulo Slums Urban-ization Program), which became the largest in Latin America in 2005. The goal is to develop infrastructure and to connect all households to the power and water supply. TÜV Rhein-land Ductor supports the housing society SEHAB by taking over process and content management – currently, for example, in the »Paraisópolis« urbanization program in São Paulo.

p For the fifth time in a row, TÜV Rheinland

is one of the top employers in Germany: the

study »Germany’s Top Employers 2012« attests

to outstanding and modern personnel manage-

ment. TÜV Rheinland is particularly impressive

in the areas of career opportunities criteria and

training and development. Since 2003, compa-

nies with a high-quality personnel strategy and

practice are recognized that offer good working

and career conditions to young academics, in

particular. In 2012, 118 companies were evalu-

ated across different industries.

76


p On October 17, the winner was awarded the ÖkoGlobe 2012. The ÖkoGlobe is the fi rst in-ternationally recognized environmental prize for the mobility industry, and is awarded in nine categories for forward-looking innova-tion in sustainable mobility. Another category honors special personalities: in this category, Prof. Dr.-Ing. Bruno O. Braun was awarded the ÖkoGlobe for his lifetime achievement. The chairman of the Supervisory Board and long-time CEO of TÜV Rheinland AG has contributed significantly to promoting for-ward-looking technologies and creating an innovation-friendly climate. After receiv-ing the award, Prof. Dr.-Ing. Bruno O. Braun said: »When looking at award-winning in-novations today, one senses what it means to be an engineer – it means making life easier in a sustainable way.« He is a passionate en-gineer, who introduced the globalization of TÜV Rheinland early on. His vision of a knowledge-based testing company that in-spects and certifi es the worldwide safety and environmental impact of technical products has now become a reality.

On the event of Prof. Dr.-Ing. Bruno O. Braun’s 70th birthday in August 2012, the renowned Frankfurter Allgemeine Zeitung acknowl-edged his commitment and honored him as »Germany’s top engineer.«

GENERAL CONDITIONS

Macroeconomic Developments in 2012

Global economic growth slowed somewhat in 2012. Altogether, worldwide gross domestic product increased by 3.2% as compared with the previous year (3.9%). In 2012, the global economy was particularly infl uenced by the Eu-ropean sovereign debt crisis and the uncertainty connected with financial policy in the United States. The consolidations in the industrialized countries and the uncertainty of consumers and investors about future economic trends acted as dampening factors on the growth of the global

economy. Additionally, there was a weakening of economic activity in developing countries. Immediately after the fi nancial crisis, the econo-my of developing countries experienced power-ful expansion, thus functioning as a stabilizing element on the global economy. However, due to the lack of demand from industrialized coun-tries and internal economic problems, there has been a powerful slowdown of economic growth. Nevertheless, the mood in the developing countries has improved somewhat by the end of the year, so that the indicator for the global economic climate in the fourth quarter of 2012 slightly increased once again. However, it is still below its non-current average.

USA: The US gross domestic product increased by 2.3% in the year 2012, after having grown by 1.8% in the previous year. The North American economy is therefore steering a course of mod-erate growth. Real estate prices have apparently stabilized overall. Private residence investments also registered a strong plus, so that a general reduction of the structural problems on the real estate market can be assumed. The level of debt of private households declined, but private consumer spending increased only moderately. However, the situation on the labor market is still restrained. Overall, uncertainty about future economic policy is putting a noticeable strain on economic development in the United States.

BRICS Countries: Because TÜV Rheinland has a presence in the BRICS countries (Brazil, Russia, India, China, and South Africa), the economic development of these countries is particularly important to the Group. In 2012, the BRICS countries made a significant contribution to international economic expansion with their dynamic development. Of the fi ve BRICS coun-tries, Brazil brought up the rear in terms of eco-nomic development.

China: Economic activity in China gradually accelerated over the course of 2012, although the tempo was slower than in the previous year. Gross domestic product rose only 7.8%

77


Financial Report


Highlights

General Conditions

(previous year: 9.3%). The rise of economic growth can be particularly attributed to a rapid surge of industrial production and a signifi cant increase in the investment rate over the course of 2012. The drastic decline of the infl ation rate also stimulated domestic demand. In contrast, dampening effects came from foreign trade. Against the background of slowing expansion in the eurozone, the Chinese export business expe-rienced a signifi cant loss of momentum in the third quarter of 2012. However, a rebound of the Chinese export business could be seen at end of the year.

Brazil: The economy in Brazil accelerated again somewhat in the second half of the year, while economic development before then was char-acterized by economic weakening and a stag-nation of gross domestic product. The gradual economic upturn in the second half of the year can be particularly attributed to stronger growth of private consumer spending and exports, al-though another sharp decline of investments was recorded. Brazil’s gross domestic product rose by 1% overall (previous year: 2.7%).

Europe: In 2012, the economy in the eurozone remained in recession due to the European sovereign debt crisis. The gross domestic prod-uct fell by a total of 0.4% in the year 2012, af-ter having grown by 1.4% in the previous year. Economic development in the eurozone in 2012 was particularly influenced by consolidations, debt reduction in the private sector, and uncer-tainty about how the European sovereign debt crisis would be handled in the future. Uncer-tainty about how economic and fi nancial policy would proceed in the future with regard to the European sovereign debt crisis led to a decline in corporate investments, and therefore acted as a burden on the economy in the eurozone. How-ever, the European economy was supported by an expansive monetary policy. Overall the euro-zone recorded very heterogeneous economic de-velopment. In countries directly affected by the crisis, macroeconomic production continued to decline. Particularly Spain, Italy, and Portugal

saw a noticeable decline of their gross domes-tic product. In contrast, Germany and France in particular – as in the previous year – made important contributions to the European econ-omy. The situation on the labor market con-tinued to worsen; the unemployment rate rose continuously over the course of 2012, whereby the situation on the labor market in Spain was particularly critical.

Germany: The German economy grew some-what more slowly in 2012 as compared with the previous year. According to information from the International Monetary Fund (IMF), gross domestic product rose by 0.9%, after having grown by 3.1% in the previous year. The reason for the current period of weakness is primar-ily the debt and confi dence crisis in Europe. In addition to uncertainty about the economic procedure to manage the crisis, the weak for-eign policy environment also leads to negative growth effects. Macroeconomic production fell sharply in the fourth quarter of 2012. A signifi -cant reduction of exports could also be seen at the end of the year. Particularly manufacturers of investment products recorded a sharp decline due to depressed demand from both foreign and domestic customers. Due to the weak economy, the situation on the labor market also wors-ened. The number of unemployed persons rose slightly in 2012. With regard to new orders in in-dustry, however, since the beginning of the fall, a slight tendency toward revival was noticed, which can presumably be attributed to rallying demand from developing countries. Addition-ally, in November 2012, the Ifo Business Climate Index improved again for the first time in six months, and also continued to show an upward trend in December 2012.

Effects on Business: As a service provider in the TIC (testing, inspection, and certifi cation) sec-tor, the TÜV Rheinland Group provides prod-ucts and services across various industries. As a result, it is largely independent of industry-spe-cifi c trends. This particularly applies to the im-plementation of statutory tests and inspections.

78


In many business areas, TÜV Rheinland is a mar-ket leader. Overall economic development in its principal markets Europe, Asia, and America may be important for TÜV Rheinland, but is not, in view of its industrial and regional diversifi ca-tion, the sole determining factor.

NET ASSETS, FINANCIAL POSITION AND RESULTS OF OPERATION

The TÜV Rheinland Group’s consolidated fi nan-cial statements are prepared in accordance with International Financial Reporting Standards (IFRS).

Development of Revenues

Consolidated revenues, including inventory changes, are broken down worldwide as follows:

Revenues by Business Stream

in € millions 2011 2012

Industrial Services 453 488

Mobility 336 366

Products 372 396

Life Care 51 55

Training and Consulting 160 194

Systems 127 118

Other* –82 –86

Total 1,417 1,531

* Intra-Group revenues and central functions.

Revenues by Region


Germany 788* 814*

Europe (excl. Germany) 165 171

Asia (incl. IMEA**) 274 329

America 190 217

Total 1,417 1,531

* Includes €57.9 million of exports (previous year: €53.7 million).

** IMEA: India, Middle East, Africa.

TÜV Rheinland Group revenues (including in-ventory changes) totaled €1,531.4 million in 2012. That amounted to a revenue increase of €114.3 million or relative revenue growth of 8.1% year-over-year.

This additional revenue (€73.6 million) was earned mainly in the range of existing services. Both the expansion of the basis for consolida-tion in the amount of €21.9 million and curren-cy changes, which amount to €18.8 million in comparison with the previous year, had a posi-tive effect on the development of revenue.

2011

2012

2010

2009

2008

2007*

2006*

2005*

788 629 1,417

814 717 1,531

446735 1,181

763 1,303540

641 984343

708 1,100392

534 796262

600 902302

Development of Revenues (including inventory changes)in € millions

* Acc. to HGB.

Germany Abroad

Domestic revenue growth was predominantly organic, but was also partially infl uenced by ac-quisitions such as the acquisition of the campus Group in the Training and Consulting Business Stream. Internationally, the Group also achieved largely organic growth. Acquisitions such as TÜV Rheinland AIA Services, LLC, in the United States, which was acquired at the end of 2011, or the fi rst-time full consolidation of SECTA S.A. in France, contributed only a small fraction here. Growth was generated in all regions.

The Industrial Services Business Stream again made the largest contribution. In comparison with the previous year, revenue grew by €35.0 million or 7.7%. The Project Management, En-ergy and Environment Technology, and Pressure Equipment and Materials Technology Business Fields were the main contributors to the increase in revenue. The repeated signifi cant increase in the Project Management Business Field is attrib-utable to consistently high demand in the infra-structure sector, primarily in Brazil.

12

7 3

25

30

23

Industrial Services

Mobility

Products


Systems

Life Care

Revenues by Business Streamin %

79


Financial Report


General Conditions

Net Assets, Financial Position

and Results of Operation

In 2012, signifi cant revenue growth was also re-corded in the newly defi ned Supply Chain Ser-vices Business Field, in which the organization and handling of large global projects from the growth sectors oil and gas, renewable energies, and infrastructure are bundled. The Business Field also supports sales.

Internationally, the Business Stream grew par-ticularly in the regions South America, Greater China, and IMEA.

The Mobility Business Stream increased its rev-enues by €30 million or 8.9%. The dynamic growth in the traditional Business Fields Peri-odical Technical Inspection, Car Services and Appraisal, and Rail was decisive. The revenue increase of the Periodical Technical Inspection Business Field was connected with the inclu-sion of SECTA S.A. as a fully consolidated com-pany beginning in April 2012. Furthermore, in the Rail Business Field, both the acquisition of the business operations of Rail Safety Consult-ing in the United States and strong business de-velopment in Germany at the beginning of the business year had a positive effect. The Mobility Business Stream therefore achieved above-aver-age growth rates internationally in the regions Western Europe and North America.

The Products Business Stream improved on its previous year’s revenue by €24.0 million or 6.5%. The growth was due (in addition to posi-tive currency effects) mainly to increased de-mand for testing services in the Electrical (safety and quality inspections of electrical products) and Commercial (testing of components and power tools) Business Fields. In contrast, the So-lar and Softlines Business Fields (including test-ing of household goods, cosmetic products, and textiles) saw decreased revenue due to a more diffi cult market environment. The growth of the Products Business Stream came from the Asia Pacifi c region and also from Greater China, es-sentially due to currency factors.

In 2012, the Life Care Business Stream recorded an increase in revenue of 7.8% overall, main-ly based on the welcome development of the

Occupational Health and Safety Business Field. For this Business Stream, which is traditionally active in Germany, foreign markets such as in Middle and Eastern Europe are becoming in-creasingly important. The Training and Consulting Business Stream showed a strong increase in revenue in 2012, at €34 million. On the one hand, the increase in revenue was due to the takeover of the IT train-ing provider the campus GmbH on July 1, 2012. On the other hand, the Information Security Business Field, which grew dynamically in 2012 and had previously been assigned to the Systems Business Stream, was transferred to the respon-sibility of the Training and Consulting Business Stream due to the emphasis on consulting in the current business year. The Professional Training, Human Resources Management, and Business Consulting Business Fields reported stable rev-enues in 2012.

Revenue in the Systems Business Stream fell by €9 million. This is due to the reclassification of the Information Security Business Field into the Training and Consulting Business Stream, as described above. Adjusted for this effect, the Systems Business Stream grew by €11 million or 10.2% in the Business Fields Certification of Management Systems and particularly Cus-tomized Services. Internationally, revenues in-creased particularly in the Greater China and Asia Pacifi c regions.

In Germany, the operations achieved 3.3% growth overall. In addition to Training and Consulting, particularly Industrial Services and Mobility – the Business Streams with the high-est revenue – continued to post stable growth in 2012, whereas, due to declining revenue in the Hardlines Business Field (testing services for furniture, toys, and electrical products), the Ger-man operation Products did not reach its previ-ous year’s revenue.

With revenues of €88 million, the Group’s inter-national subsidiaries clearly exceeded the previ-ous year’s total of €629 million by 14%. Taking exports from Germany into account, 50.6% of

80


the Group’s output was earned either interna-tionally or with international customers. The main growth drivers were the regions IMEA, North America, Asia Pacifi c, Greater China, and South America.

In Western Europe, revenues rose by 3.5%. France achieved the highest growth – due to the full inclusion of SECTA S.A. – while in the other Western European countries, such as Spain and Portugal, revenues declined slightly.

In Middle and Eastern Europe, revenues con-tinued to increase, which, as in the previous year, can be particularly attributed to welcome growth in Poland, Ukraine, and Hungary.

The Asia Pacifi c region reported 22.2% growth in revenue, also partly due to currency factors. Rev-enue grew in all of the countries in this region, where, in addition to Japan, Korea, Thailand, and Indonesia, special mention should also be made of the Philippines.

In the Greater China region, revenues built on the high growth rates of previous years with a 16.4% increase due exclusively to organic fac-tors. In addition to positive currency effects in China and Taiwan, the Industrial Services Business Stream contributed to the increase, while revenues in the Products Business Stream declined.

The IMEA region reported the highest growth momentum in the Group, with a growth rate of 31.5%. This was due mainly to the positive busi-ness developments in the Gulf states, India, and South Africa.

In North America, revenues grew considerably at 24%. In addition to positive currency effects, this resulted, on the one hand, from the pur-chase of Rail Safety Services Inc. and, on the oth-er hand, from a consolidation effect of the stock-piling of shares of TÜV Rheinland AIA Services, LLC, which had already happened in 2011. Fur-thermore, strong Industrial Services business in Mexico contributed to the increase in revenue.

Revenues in South America rose again signifi-cantly with a 10.8% increase; adjusted for cur-rency effect, growth was just under 20%. With this, South America resumes its high revenue growth. Consistently high demand for services in the areas of energy and infrastructure was the revenue driver for the region.

Development of Income

2011

2012

2010

2009

2008

2007*

2006*

2005*

67.0

57.8

44.5

56.9

35.1

44.1

21.2

29.4

Consolidated Net Income for the Year in € millions

* Acc. to HGB.


Earnings before interest, taxes, depre-ciation, and amortization (EBITDA) 171.2 167.2

Amortization of intangible assets and

depreciation of property, plant, and

equipment – 47.2 –54.0

Earnings before interest and taxes (EBIT) 124.0 113.2

Financial result –20.4 –19.1

Earnings before tax (EBT) 103.6 94.1

Income taxes –36.6 –36.3

Consolidated net income 67.0 57.8

At €167.2 million, earnings before interest, tax-es, depreciation, and amortization (EBITDA) almost reached the high previous year’s total of €171.2 million.

Earnings before interest and taxes (EBIT) and earnings before tax (EBT) were slightly lower than in the previous year, with a change of 8.7% and 9.2% respectively.

The Business Streams Industrial Services and particularly Systems improved on the previous year’s fi gures with pleasing incomes. While the Mobility and Life Care Business Streams posted

81


Financial Report




stable results, the Products and Training and Consulting Business Streams registered declin-ing incomes.

In the Products Business Stream, the Solar and Softlines Business Fields in particular posted re-duced contributions to operating income com-pared with the previous year. In the Training and Consulting Business Stream, the revenues for the Business Consulting and Human Re-sources Management Business Fields declined.

Overall EBIT, however, fell below the fi gure for the previous year by €10.8 million.

While the regions Western Europe, Middle and Eastern Europe, and South America are particu-larly affected by declines in 2012, the regions Greater China and Asia Pacifi c continue to im-prove. In particular, the still noticeable effects of the fi nancial crisis in some European countries contributed to this development. Necessary ef-forts to stabilize or increase revenue beginning in 2013 have been implemented and are already showing their fi rst signs of success.

Compared with the previous year, the quota of the cost of purchased services changed as a per-centage of total output from 12.8% to 13.4%.

The quota of personnel expenses rose only slightly from 55.5% in the previous year to 56.1% in 2012, which, in relation to growth in revenue, was due to a largely proportional 7.9% increase in employee numbers.

At 22.2%, the quota of other expenses remained largely constant (previous year: 22.1%).

Impairment increased – in relation to revenues – from 3.3% in the previous year to 3.5%.

The improvement in the fi nancial result was pre-dominantly due to a more favorable net funding fi gure for pension commitments and further re-duced loan interest rates.

Earnings before tax at €91.4 million were below the previous year’s €103.6 million.

Income taxes totaling €36.3 million (previous year: €36.6 million) were primarily in foreign countries, at €19.7 million. The tax ratio was 38.5% after 35.3% in the previous year; this change was essentially due to higher negative effects on earnings in international companies, for which no asset-side deferred taxes could be created.

Consolidated net income for the year thereby fell 13.7%, from €67.0 million to €57.8 million.

Financial Position

The cash fl ow statement was prepared on the ba-sis of the consolidated fi nancial statements.

2011

2012

2010

2009

2008

2007*

2006*

2005*

112.3

108.0

77.8

100.1

71.8

77.8

50.1

64.0

Gross cash flow in € millions

* Acc. to HGB.

Gross cash fl ow was €108.0 million, down slight-ly at €4.3 million below the previous year (€112.3 million).

At €93.2 million, the operating cash flow de-creased on the previous year (€101.1 million). In addition to a reduced Group net balance, work-ing capital – increased due to growth – led to this change.

Taking the 2012 asset disposals into account, in-vestments (including the increase in reinsurance policies) led on balance to a €76 million net out-fl ow of funds that was fi nanced entirely from the operating cash fl ow.

In fi nancing activities, more current bank liabili-ties were redeemed than new non-current bank liabilities were entered into, and a dividend was paid to the shareholder. That leads to a €22.1 million net cash outfl ow from fi nancing activity.

82


Liquid assets amounted to €88.4 million as at De-cember 31, 2012. With fi nancial liabilities drop-ping to €128.6 million, net financial liabilities were reduced to €40.2 million (previous year: €38.5 million).

The dynamic debt–equity ratio, which specifi es the length of time required to repay the Group’s fi nancial liabilities, was less than a year in rela-tion to EBITDA.

To ensure its ongoing solvency, the TÜV Rhein-land Group maintains extensive current- and non-current lines of credit, of which only a frac-tion was used as at December 31, 2012.

Balance Sheet and Capital Structure

The balance sheet total rose by 7.7% or €103.6 million to €1,452 million.

Non-current assets increased by €65.6 million overall. The main reasons for the increase in non-current assets were acquisition-related in-crease in goodwill and intangible assets as well as investments in property, plant, and equip-ment. Goodwill and the intangible assets iden-tifi ed in connection with acquisitions increased by a total of €24.6 million. Investments in fixed assets (including intangible assets) total-ing €73.9 million were accompanied by €54.0 million in depreciation and €8.6 million in net disposals. In other financial assets, along-side an increase of the actuarial reserve quotas by €6.0 million, the scheduled repayment of non-current securities totaling €4.2 million

also had an effect. Asset-side deferred taxes in-creased by €30.7 million, particularly in con-nection with the signifi cantly increased pension commitments.

Current assets rose by €38.0 million, which, on the one hand, was due to a revenue- and consol-idation basis-related €48.2 million increase in inventories and trade receivables; on the other hand, there was also a reduction – primarily at-tributable to tax refunds – of income tax receiv-ables totaling €6.6 million and a €4.8 million decline of cash and cash equivalents.

Equity capital changed by a total of €33.5 mil-lion, from €325.3 million to €291.8 million. Es-sential factors for this were, on the one hand, the positive addition from the consolidated net income for the year totaling €57.8 million and, on the other hand, the signifi cant increase of the actuarial losses totaling €105.4 million, which resulted from a reduction of the actuarial interest rate from 5.0% to 3.5% for the discount-ing of pension commitments. The €15.6 mil-lion dividend for the 2011 business year paid to the Group’s shareholder TÜV Rheinland Berlin Brandenburg Pfalz e. V. also reduced equity capi-tal. Other changes, such as negative impact from foreign currency translation and positive impact from deferred taxes, had the effect of increasing equity capital by €29.7 million.

As a result, the equity ratio changed from 24.1% to 20.1% despite the higher balance sheet total.

20112012 2011 2012

16.8 %

7.5 %

55.6 %

20.1 %

17.8 %

6.9 %

51.2 %

24.1 %

14.1 %

17.6 %

68.3 %

12.5%

19.7 %

67.8 %Non-current assets(incl. goodwill 11.8% (2011: 12.1%))

Inventories, trade receivables

Other receivables, cash and cash equivalents

Equity

Non-current liabilities(incl. provisions for pensions and similar obligations)

Trade liabilities

Other current liabilities

Balance Sheet and Capital Structure

83


Financial Report




If external financing of pension commitments were undertaken as part of a contractual trust ar-rangement (CTA), the TÜV Rheinland Group’s equity ratio would amount to 24.6%.

Under non-current liabilities, the Group’s pen-sion commitments were reduced by €100.4 mil-lion to €656.3 million, due mainly to the 150 ba-sis point discount rate reduction. Furthermore, non-current fi nancial liabilities rose by a total of €9.4 million, due to an increased balance from new loans and repayments. The €3.6 million in-crease of liabilities-side deferred taxes was main-ly linked to the statement of tax reversal effects from purchase price allocations. The €19.8 mil-lion increase in current liabilities resulted from higher current provisions and trade liabilities, on the one hand, and lower current fi nancial liabili-ties, on the other.

Assets committed on a non-current basis along with some of the Group’s current assets were fi -nanced by non-current capital (non-current as-set cover: 111.5%). Investments

The volume of investments in the business year, not including corporate acquisitions, totaled €73.9 million. Investments were made mainly in laboratories, software, and testing sites.

Numerous investments were made particularly in testing labs for the Battery, Solar, and Softlines divisions. Asia Pacifi c, IMEA, and Greater China were their regional focal points. Special mention should be made of the putting into operation of the new KTAC (Kansai Technology Assessment Center) testing lab for photovoltaic and energy storage systems in Osaka, Japan, with an invest-ment volume of €4.5 million. Furthermore, the strategically signifi cant expansion of the labora-tory network for Softlines and Electrical in the growth markets India and Turkey with €3.4 mil-lion deserves mentioning.

Another focal point for investments in 2012 was the unifi cation of the software landscape in the TÜV Rheinland Group. The project »TÜV Rhein-land Workplace,« which was started in 2011, has been continued consistently. With the world-wide coordinated introduction of Microsoft products, the IT infrastructure across the Group will be further standardized and improved to develop TÜV Rheinland’s international network further. A total of €3.3 million was invested in 2012.

Moreover, additional investments were made in the IPMS (Integrated Project Management Sys-tem) and ICMS (Integrated Certification Man-agement System) projects. IPMS and ICMS are uniform IT system solutions for mapping the entire value chain from tender preparation to or-der follow-up in the Products and Systems Busi-ness Streams. In 2012, IPMS was successfully in-troduced in the TÜV Rheinland Group after the conclusion of a short implementation phase.

In the course of the deregulation of the Span-ish automobile market, which started years ago, TÜV Rheinland Ibérica S.A. made further invest-ments in automotive testing locations. Greater Madrid also represented a special focus here in 2012.

BUSINESS SITUATION

The TÜV Rheinland Group consolidated its posi-tion as one of the world’s leading technical ser-vice providers in the TIC market.

The Group’s aspiration and guiding principle is to be the best independent provider of techni-cal services for testing, inspection, certifi cation, consulting, and training.

TÜV Rheinland employees are guided in their work by the conviction that societal and techni-cal progress are inseparably connected.

That is precisely the reason why the safe and res-ponsible use of technical innovations, products, and plants is of decisive importance.

84


Industrial Services

The Industrial Services Business Stream also built on the successes of previous years in 2012. In ad-dition to the growth drivers Germany and the South America region, the IMEA, Asia Pacific, and Greater China regions in particular showed positive developments, while growth in the Mid-dle and Eastern Europe region and North Ameri-ca tended to stagnate.

Today, the Industrial Services Business Stream’s broad service portfolio extends from the tra-ditional testing of boilers, pressure tanks, and steam generators to integrated project manage-ment and industry-specific solutions. In the process, it also became clear again in 2012 that both national and international project plan-ners, property developers, investors, operators, and manufacturers fi nd these services convinc-ing. In addition to the technical competence of TÜV Rheinland’s experts and their focus on customers and the market, the continuous op-timization of internal work fl ows and processes provides a recipe for success.

TÜV Rheinland reached a milestone as a service provider in the wind power industry: the Ger-man accreditation body DAkkS recognized the Group as a certifi cation organization for the type and component certification of wind energy plants according to the international standard IEC 61400-22. This means that, in the certifi ca-tion of wind energy plants, TÜV Rheinland of-fers complete one-stop service, and has already improved the order situation in 2012 in this sector accordingly. Furthermore, the position in the offshore market was strengthened by the completion of an extensive audit assignment on the safety of maritime operations in the installa-tion of wind projects.

With newly obtained large projects in the IMEA and Asia Pacifi c regions, TÜV Rheinland further developed its market presence as a testing service and provider of services for the oil and gas indus-try and its customer base for risk assessment on the international level. For example, as a result of handling a large order in Taiwan, the Group was able to consolidate its position as a leading and

profi cient testing service for industrial safety and minimizing risks at petrochemical plants.

In addition, in 2012, the conventional energy sector continued to rely on TÜV Rheinland’s ex-pertise: customers benefi t from the expertise of TÜV Rheinland’s employees, specifically when dealing with high-temperature materials. In ad-dition, newly obtained orders for nuclear energy projects in Korea, Japan, and Brazil created de-mand for experts.

Of particular note are advances in the area of supply chain and integrity services. Here, TÜV Rheinland has been recognized by the Ger-man accreditation body DAkkS as an inspection site for plants, systems, and components ac-cording to the international standard EN/ISO/IEC 17020. As a result, since 2012, the Group has been able to offer its customers an expanded ser-vice portfolio at the same level of quality and safety they are accustomed to.

Focal points in 2013 remain further developing the service portfolio and, in particular, develop-ing services for conventional, nuclear, and re-newable energies internationally for both the oil and gas industry. In the process, the implemen-tation of innovations is constantly promoted in all areas. In addition to Europe, regional focal points will be the BRICS and the Next Eleven countries.

Mobility

The Mobility Business Stream again experienced good development in the business year 2012. Against the background of domestic business, which was very sound once again, priorities were on developing activities abroad. Here, important steps were taken in 2012 for the implementation of services.

In the future, Eastern Europe, Asia, Africa, and South America will remain target markets for commercializing TÜV Rheinland’s core compe-tencies. The approach pursued to accomplish this, of both growing organically in the regions and securing market share through acquisitions, was successfully implemented in 2012.

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In the automotive sector, the takeover of an en-gineering company in Kaufbeuren was a further step in the regional expansion into southern Germany. The acquisition of a service provider in the automotive sector in Düsseldorf helped expand the service portfolio in the car dealership and fl eet service sector. Internationally, acquir-ing a majority stake in SECTA S.A., Courbevoie, France, had a clearly positive affect on revenues and income.

By further developing the service bandwidth in the Car Services and Appraisal Business Field, a very good basis for future growth was created, with a focus on the international sector. This commitment will be continued in 2013 by con-centrating resources in West Europe, Asia, and South America.

The Rail Business Field achieved above-average development in all operational regions. Accom-panied by very strong revenue and earnings growth in Germany, international activities in this Business Field also saw favorable increases. The investments of the past are already paying off here.

The field of electromobility also recorded suc-cesses in 2012. In addition to numerous training services, a cooperation agreement was signed with one of the world’s foremost German auto-mobile companies, which plans for TÜV Rhein-land to serve in an advisory capacity in the devel-opment of necessary electrical infrastructure for customers with electric cars in over 90 countries.

As part of the provision of services and central sector support, IT has implemented a number of projects to improve process sequences. Addition-ally, via its global Business Field leader, the Busi-ness Stream began an initiative to document and harmonize accreditation, procedure, and process descriptions.

The new Strategy 2017 defi nes the objective for the next fi ve years. The implementation of the efforts already began in 2012 with high prior-ity, creating the basis for a continuing successful

development of the Mobility Business Stream in the years to come.

Products

The Products Business Stream also continued to grow in 2012, although at a slightly slower pace than in previous years. The Commercial and Medical Business Fields showed the highest growth rates in revenue. Electrical remained the most important Business Field, with the largest share of revenue. In the Electrical Business Field, TÜV Rheinland again asserted its market leader-ship in 2012 with regard to CB certifi cates issued in the international certifi cation procedure for electronic consumer goods. The Electrical Busi-ness Field is in an excellent position for current market trends such as testing 3-D screens, LED systems, wireless technologies, and lithium batteries.

For the first time since its market launch, the Solar and Fuel Cell Technology Business Field recorded a decline in revenue, although TÜV Rhein land was able to defend its global mar-ket leadership in this area and generate a clearly positive EBIT margin. The reasons for the decline in revenue are complex: economic crises in Eu-rope and America; reduction of compensation for electricity fed into the grid in important mar-kets; Asian mass production with a dramatic de-cline in prices in the modules, resulting in more manufacturer insolvencies domestically; and a German energy and climate policy that is diffi -cult to forecast.

Meanwhile, three quarters of the revenue in the Products Business Stream are generated abroad, with focal points in the Greater China and Asia Pacific regions. However, the strongest growth is in the IMEA and South America regions. In Germany, the Products Business Stream was able to maintain its high-level position as a market leader.

A focal point of investments in 2012 was the further development of the worldwide labor network. TÜV Rheinland responded to increas-ing demand from Turkish industry for quality

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and substance testing for export products with a new Softlines laboratory. In Gurgaon (India), the Group invested in a Softlines laboratory that is 1,500 square meters in size; additional Softlines laboratories in Bangalore and Tiruppur (India) are scheduled to follow in 2013. This means that the global network of Softlines laboratories now has testing facilities in nine countries.

In Jidda (Saudi Arabia), a new testing center was opened for automobile industry products (brake linings and oil fi lters) and for household appli-ances, offi ce supplies, lighting materials, and IT as well as telecommunications products. In co-operation with Yeungsam University, another testing lab for photovoltaic modules was built in Gyeongsan, South Korea. This new testing lab is the fi rst one in Korea that is operated according to international standards. In 2012, a new testing lab for photovoltaic and energy storage systems was inaugurated in the Technology Assessment Center in Osaka (Japan), with 2,500 square me-ters of space. Rechargeable energy storage sys-tems such as lithium-ion batteries and super ca-pacitors are tested here.

A testing center was built in Leek in the Nether-lands that specializes in tests and certifying wire-less devices, electric and electronic products, medical devices, and telecommunications prod-ucts. The new testing center is the only accred-ited laboratory in the Netherlands that measures the infl uence of electrical radiation on people. In Leipzig, Germany, the testing center for personal protective equipment was expanded substan-tially and the laboratory equipment was mod-ernized. As a result, the foundations were laid for achieving market leadership in this segment.

The founding of the Food-Cert-Alliance, a net-work of German analytical laboratories under the umbrella of TÜV Rheinland, offers our cus-tomers a unique and flexible network in the food sector, supplemented by a new test seal – »controlled food quality.« With this alliance, TÜV Rheinland will set new standards in the German food market.

After successful introduction in Germany, the new IT process management IPMS (Integrated Project Management System) for worldwide harmonization and standardization of testing processes and procedures has also been imple-mented in China and North America. As a result, testing times are shortened again and the high quality of the tests is ensured.

»Further strengthened, the Products Business Stream will position itself as the leading service provider regarding energy effi ciency and sustain-ability,« emphasizes Prof. Ralf Wilde, Executive Vice President of the Products Business Stream. Examples in this fi eld would be corporate social responsibility, green services, climate protection, and smart grid.

Life Care

In the past year, the Life Care Business Stream almost completely reached its revenue and in-come goals. The project to strategically reorient and improve work fl ows as well as effi ciency and service quality was successfully concluded in the business year 2012. Additionally, last year a new integrated standard software began to be intro-duced, rounding off the success of the concluded project.

The services for customers have been further focused: health management and occupational safety as the main area of work and medical cen-ter services as a supplementary offering for the health-care industry. These Business Fields were expanded in Germany and successfully mar-keted internationally in selected target regions. Of particular note in Germany is the opening of the first TÜV Rheinland center of expertise for integrative health management in Bad Neue-nahr. Additional projects in other regions as well as new contracts with prestigious key accounts that also want to use the offering internationally will follow. TÜV Rheinland has already success-fully overseen large projects in Eastern Europe and South America. Numerous international planned projects have also been addressed in co-operation with the Industrial Services and Prod-ucts Business Streams.

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As part of Strategy 2017, the Business Stream con-fi rms its growth and income goals and underlays them with promising, increasingly international projects. The implementation has started and will be intensified in the business year 2013. In 2013 the Business Stream expects stronger growth – both in Germany and internationally.


In the business year 2012, the Training and Con-sulting Business Stream recorded significant growth compared to the previous year, with total revenues of €194 million. Two corporate acquisitions in the training area contributed to this, as did strong organic growth in the area of Information Security.

Despite continuing reduction of state support of advanced professional training in the train-ing area, TÜV Rheinland not only affirmed its position as the leading training provider in Ger-many, but also developed it. In particular, the free-market seminar business for corporate and private customers also grew again signifi cantly in 2012, and was able to offset declines in the publicly supported qualification business. Ad-ditionally, at the beginning of the year, with the takeover of the business operations of e/t/s GmbH in the increasingly important field of Workplace Learning Solutions (WLS), such as e-learning and mobile learning, it was possible to signifi cantly expand the range of services.

In the middle of 2012, TÜV Rheinland acquired 100% of the shares in the campus GmbH, a cer-tifi ed provider and market leader of IT seminars and qualifi cation products for software products from well-known producers such as Microsoft, Oracle, and Linux. With the acquisition of e/t/s and campus in connection with its already ex-isting training and consulting services in the IT sector, TÜV Rheinland is considerably strength-ening its strategic direction and its service port-folio in the area of information and communi-cations technology.

In the Consulting Business Field, business ac-tivities focused on consulting projects in the telecommunications sector, and particularly on coordinating the creation of the nationwide digital wireless network for the German police and other authorities and organizations with security tasks. Another focal point was the fur-ther development of the nationwide broadband atlas, which was commissioned by the Federal Ministry of Economics and Technology.

Despite changes to the framework conditions re-sulting from new tariff regulations in traditional temporary employment, in the HR Services area TÜV Rheinland was able to maintain its market position and gain key contracts, particularly in the project-oriented business of »Engineering Services.«

In the Information Security Business Field, TÜV Rheinland saw encouragingly strong and profitable growth in the year 2012. In general, revenues developed more positively than an-ticipated due to large contracts in fi nancial in-formatics. There were also successes in the area »Production Safety/Critical Infrastructures.« For the new service »Security in the Cloud,« it was possible to acquire important reference customers.

In the year 2013, the significant expansion of international business had high priority. In particular, the rollout of IT training services in key markets such as China and Brazil, as well as the construction and expansion of profes-sional training centers in India are the focus of this strategy of internationalization. »Our ex-periences and successes as the leading training provider in Germany create a strong foundation for the rollout of these services in international markets,« said Siegfried Schmauder, Executive Vice President of the Training and Consulting Business Stream at TÜV Rheinland.

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Systems

In the business year 2012 – adjusted for carry-over effects – the Systems Business Stream saw a revenue increase again, thereby continuing the positive development of recent years.

The Business Stream evaluates management systems, IT processes, and companies accord-ing to internationally recognized standards or according to individual criteria. In 2012, the in-troduction of the new DIN EN ISO 50001 gener-ated broad interest, so that growth was achieved particularly through the certifi cation of energy management systems. The standard supports companies in the creation of systems to improve their energy effi ciency and their energy-related performance.

Among the non-accredited services, in 2012 ser-vices in the area of sustainability, CSR, service quality, and data and information technology continued to develop well. Above all, the Busi-ness Stream benefited from experiences from CRS audits that it performed – for example, in China: an international project team with ex-perts from Asia, South America, and Europe defined unified structures for the global CSR business. This includes data and information exchange, harmonizing working guidelines, and optimizing international cooperation. Sev-eral CSR contracts have already been successfully implemented as part of the project such as a pi-lot project to protect the international supply chain of the pharmaceutical industry. The goal is to expand the established structures, so that in-ternational CSR audit programs can be success-fully carried out within TÜV Rheinland’s global network.

Due to the introduction of ICMS, large advances have been made with regard to optimizing and stabilizing processes. ICMS makes it possible to standardize processes internationally, minimize interfaces, and use an integrated SAP platform that maps all processes, beginning with custom-er contacts and covering tender preparation, au-dit processing, and sending invoices.

In 2012, the ICMS project ran according to plan, and entered a decisive phase in 2013 with its roll-out in Germany, Netherlands, China, and the United States. Experiences from the pilot phase reveal more effective and optimized processes that lead to quality improvements.

In 2013, the further internationalization of ser-vice offers is of primary importance. The expan-sion of the global network has priority, particu-larly for sales, in order to be more competitive with key international accounts and bids.

In the development of innovative product ideas, a large step forward could be made with the help of the strategic marketing instrument »Blue Ocean Methodology.« A project team developed ideas for expanding business activities – of these, ten innovations were presented to a broad inter-nal and external public, which then evaluated them. The feedback, in addition to a systematic potential and implementation analysis with ap-propriately calculated business cases, fl owed into the selection of the concept ideas. Several ser-vices and IT-based concepts showed high busi-ness potential and will be realized in 2013. Fol-lowing successful introduction, the performance of further international projects in the regions is planned.

EMPLOYEES

As at the reporting date December 31, 2012, a to-tal of 18,274 employees (full-time) are employed at TÜV Rheinland Group. In the annual average, the number of employees rose from 15,961 to 17,218; this represents an increase of 7.9% com-pared to the previous year.

The strong personnel development overall is based, on the one hand, on a continuous addi-tion in Germany of 3.8% and, on the other hand, based on an increase of 10.8% internationally due to high revenue growth in Brazil, China, In-dia, and the Gulf States.

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Employees

2011

2012

2010

2009

2008

15,961

17,218

13,804

14,412

12,987

Total staff (annual average)

Human resources management that appreci-ates employees makes a sustainable corporate structure visible and perceptible. In addition to performance-based compensation systems and business-unit-based conditions, all employees in Germany were therefore offered disability insurance fi nanced on a parity basis, which was accepted by about 30% of them.

In the 2017 corporate strategy, the elements of developing, winning over, and creating relation-ships with new employees for TÜV Rheinland are essential. As anchored in the new mission statement, constructive dialogue with employ-ees is the core of the corporate philosophy. This is manifested in regular and structured employee reviews, which in turn form the basis for future development measures. In 2011, a worldwide employee survey was also conducted, which had a participation rate of 63.1%. The analysis of the survey led to about 500 improvement measures in the regions, most of which were completed in 2012. The topics of communication and man-agement were addressed in particular. The em-ployee survey will be conducted again in the fall of 2013. Further improvement measures will be made on the basis of the survey results, in-cluding the revision of personnel development measures.

In 2012, the new training module »Leadership« was presented for the fi rst time in Bangkok with participants from Asia. Furthermore, the Talent Team Program, which was established in Germa-ny, was held for the fi rst time in Brazil and Asia Pacifi c. The program introduces future managers to the topics of project work, management, and

communications. Additional regions will follow in 2013. In 2012, the instrument for evaluating the management performance of managers, which had been in common use for two years, was implemented in a revised and expanded version.

In 2013, TÜV Rheinland is concerned with an additional management-development compo-nent and also offers a module that deals with the management functions and abilities (coach-ing skills) of young managers in more depth. In addition, TÜV Rheinland is setting up a men-toring program encompassing all its different business units, which will qualitatively improve management skills and culture.

As part of a project started in 2012, TÜV Rhe-inland has been testing required adjustments to the management structure. Due to the high rate of growth in recent years, this will help to harmonize the hierarchy levels, job specifica-tions, and functions. A transparent specialist and leadership career path with coordinated de-velopment measures and title structures that are uniform throughout the Group will be derived from this.

Successful efforts to strengthen the employer brand were also made in 2012. In addition to its certification as a TOP Employer in 2012, TÜV Rheinland improved its position in some ranking lists to a favorite employer among engi-neers. In addition to contacts with universities, investments were also made in collaborations – for example, with the German Sport University and the NRW Sports Foundation. In this way, athletes are approached specifi cally who would like to work in a predominantly technical pro-fession after their athletic careers. At the same time, the collaboration has a positive effect on operational health management.

Efforts to increase the proportion of women in the workforce will continue to be pursued in

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2013, particularly in Europe. For this purpose, in addition to participation in Girls’ Day (a voca-tional orientation day for girls, supported by the Federal Ministry for Families, Senior Citizens, Women, and Youth, among others), internal discussions with female employees are used to discuss further options to improve the compat-ibility of family and career.

With numerous offers and activities, TÜV Rhe-inland is committed to equal opportunity and the advancement of women. With a family-friendly personnel policy, the intention is to create an environment in which family and ca-reer can be combined. In Germany, this includes efforts such as the »Family and Career« project, with advice on parental leave and a child-care option.

In 2012 the conceptual foundations for a global human capital management system continued to be laid. In a joint project with employees from China and Germany, it was possible to bundle a number of Chinese payroll accounting systems in a single SAP system. In the medium term, this means that a global and uniform database can be accessed, with uniform data quality, as well as reduced IT costs and higher integration into other SAP applications.

RISK MANAGEMENT SYSTEM AND CORPORATE GOVERNANCE

For a globally active company like TÜV Rhein-land, a comprehensive internal control system (ICS) – in relation to IT-assisted business process-es and effective and efficient risk management – is an indispensable control element marking the framework for management and monitoring. The ICS is mainly intended to ensure compliance with statutory requirements, TÜV-specifi c guide-lines, and its corporate objectives. In addition, risk management aims to identify and evaluate risks at an early stage so that suitable

precautions, controls, and safeguards can be put in place and proactive countermeasures can be initiated. TÜV Rheinland AG’s Executive Board is responsible for the Group’s risk management sys-tem. In accordance with German law, the tasks of the Chief Executive Offi cer and the chairman of the Supervisory Board are strictly separate and distinct from one another.

A documented procedure in the management framework manual and a detailed description in the planning manual defi ne the risk manage-ment process. These documents are available around the world in several languages on the company’s intranet. In particular, an interdisci-plinary risk management group has been estab-lished at TÜV Rheinland AG in this context.

Several statutory initiatives were launched in re-cent years to improve corporate governance. In keeping with international standards, the Cor-porate Sector Supervision and Transparency Act (KonTraG) requires the Executive Board to take suitable measures to ensure that developments which might pose a threat to the company’s con-tinued existence are made identifi able at an early stage. This requirement is taken into account by an effective ICS and TÜV Rheinland’s early risk-warning system. Based on a risk-oriented audit approach, the Group’s Corporate Audit Depart-ment checks the ICS of TÜV Rheinland compa-nies around the world in accordance with inter-national auditing standards.

Furthermore, information gained from the semi-annual risk reports of the German and interna-tional TÜV Rheinland companies and the Busi-ness Stream Executive Vice Presidents is analyzed in detail. Based on the information obtained in the matrix organization, all of this information is then aggregated to create a Group report, which is appraised from portfolio viewpoints. Risk de-termination is based on risk indicators that are specific to TÜV Rheinland. The different risks can be arranged under the headings of market/

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Risk Management System and

Corporate Governance

customer, processes, employees, finance, and miscellaneous – such as legal framework condi-tions. Risk quantifi cation is based on the antici-pated result – or, in other words, the likelihood of the risk occurring. Additionally, the nam-ing of planned efforts also represents a central aspect.

Dealing with risks is also a part of the ongoing reporting process. Reporting follows the require-ments of the matrix structure and, in addition to regularly updating the economic outlook, also takes business-specific early indicators into ac-count. This provides an essential foundation for recognizing risk areas, as well as introducing and consistently pursuing specifi c efforts to prevent possible damage to TÜV Rheinland. In addition, the Executive Board is informed of significant circumstances by means of ad hoc statements.

Risk management thus forms an integral part of the Group’s standard planning and control pro-cesses and is incorporated in the TÜV Rheinland information and communication system. It is continuously developed further and adapted to changing framework conditions. Risk manage-ment is therefore suitable for identifying risks at an early stage that pose a threat to the Group’s continued existence and for taking appropriate countermeasures.

The Group abides by the basic principles of good corporate governance that is focused on the legal and practical framework of managing and super-vising the company. In particular, it has profes-sional compliance management with a preven-tion remit that sets out the relevant framework for TÜV Rheinland. Specifi cally, this framework includes the Code of Conduct, Anticorruption Guideline, Sponsorship Guideline, and a com-pliance hotline.

TÜV Rheinland is convinced that good corpo-rate governance is of great importance for its sustainable success and that the implementation and observance of these guidelines make a mate-rial contribution to permanently building up the trust placed in the Group by all interest groups.

VALUE MANAGEMENT AND BUSINESS-RELEVANT ENVIRONMENTAL AND SOCIAL FACTORS

In the business year 2012, the TÜV Rhein-land Group continued to extend its corporate so-cial responsibility (CSR) activities systematically on the basis of the principles of the UN’s Global Compact initiative and of the IFIA (International Federation of Inspection Agencies).

The goal of becoming the best independent pro-vider of technical services for testing, certifi ca-tion, consulting, and training was affirmed in the 2012 revision of the mission statement. The goals set for the TÜV Rheinland Group in the areas of climate change and diversity determine how the CSR program is continued in terms of content. The development of the two manage-ment systems environment and occupational safety into one integrated HSE (health, safety, and environment) management was contin-ued. Additionally, the compliance system was expanded, and risk analysis for the company is being deepened in the Business Fields and on the regional level.

In 2012, TÜV Rheinland also identifi ed new busi-ness opportunities with regard to sustainability and environmental issues. In particular, the en-ergy transformation decided upon by the Federal Republic of Germany makes specifi c engineering expertise and technical solutions necessary in the area of energy and energy efficiency. Here, the German accreditation body recognized TÜV Rheinland as a certification organization for wind energy plants. Furthermore, the market was expanded as a result of cooperation with Eu-roWind, so that, in addition to business opportu-nities in the European market, new contracts are expected, particularly in China. The Industrial Services Business Stream also continues to ben-efit from increasing demand for low-emission power stations. For the Products Business Stream, opportunities can be seen in the smart grid ser-vices area.

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Market opportunities are developing in the area of quality assurance and in the non-current, reli-able operation of photovoltaic power plants. In 2012, TÜV Rheinland opened two new testing centers in Japan and Korea, thus strengthening its position as the worldwide industry leader in testing the safety of solar modules.

Further business opportunities are developing from the demand for solutions for infrastruc-ture challenges in metropolitan areas. Particu-larly in Brazil, India, and China, infrastructure projects are being initiated or continued. Thus, TÜV Rhein land is involved in projects such as expanding local public rail service in São Paulo.

The political trend toward demanding more compliance from and sustainable performance by businesses continued in 2012. In addition to the European Commission’s demand for a bind-ing obligation to report and publish regarding specifi c environmental and social sustainability indicators, the adoption of the German Sustain-ability Code in Germany has established a na-tional tool for disclosure. In 2012, Germany’s Federal Government affi rmed its support for the German Sustainability Code. TÜV Rheinland is one of the first companies to have signed the statement of conformity with the new transpar-ency standard. This trend opens up new perspec-tives for TÜV Rheinland in assisting and certify-ing businesses in sustainability and compliance.

OPPORTUNITY AND RISK REPORT

In connection with risk management, special at-tention is paid to opportunities and risks that are not explicit elements of planning.

Important aspects result from TÜV Rheinland’s global orientation and primarily relate to cus-tomers and markets and to legal and political framework conditions.

Externally oriented opportunities are mainly as-sociated with service innovations in individual Business Streams and Fields. Prominent exam-ples of this are new services in connection with climate neutrality, e-mobility, supply chain ser-vices, and innovative services for the photovol-taic sector. Increased acquisition of large-scale orders such as support for large-scale plants and infrastructure projects offers further poten-tial. Here, too, additional opportunities open up through the option of offering customers a comprehensive package of services in a global network. As a result, market-related risks are compensated for such as declines in demand due to regulatory changes or a downturn in certain sectors like photovoltaics.

Major opportunities also continue to exist in the ongoing dynamic development of international markets. By being present in other markets with strong growth – such as Brazil, China, and In-dia – and continuous expansion of the range of services in developing countries, further protec-tion is developed. At the same time, the global position ensures a certain balancing of risks with regard to economic crises that may occur in indi-vidual countries and regions.

In addition to developing markets that are cur-rently being attended to, penetrating new mar-kets is also given special signifi cance. Apart from other Asian countries, these include the Persian Gulf. Developments in both directions will be systematically supported by increased M&A ac-tivities. Targeted acquisitions offer further poten-tial through structured integration. The overall resulting network, which will follow globalized value chains even more closely, also forms one of the most important columns of Strategy 2017.

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Corporate Governance

Value Management and Business-Relevant

Environmental and Social Factors

Opportunity and Risk Report

It will be implemented within the established matrix structure. The institutionalized, close coordination between business-specific and re-gional expertise results in additional opportu-nities – for example, in identifying new fi elds of activity and the effective and effi cient handling of projects and services.

Reduction of complexity in all areas opens up fur-ther potential in the form of a lean management approach. In addition to optimizations in the sales and administration area, this particularly includes the pooling of operating activities and the use of unified IT applications according to customer wishes. Finally, optimized project man-agement can help reduce risks in implementing internal and external development projects and large projects.

The business opportunities that arise for TÜV Rheinland from the growing importance of cor-porate social responsibility in companies around the world are discussed in the section on Value Management and Business-Relevant Environ-mental and Social Factors.

Relevant risks naturally fi rst arise from changes in the legal framework conditions. Liberalization steps can result in challenges in markets due to rising competitive pressure. One example is Spain for the Mobility and Industrial Services Business Streams. Nevertheless, this also helps to open up additional potential by providing an opportunity for supraregional operations. In Germany, the Mobility and Industrial Services Business Streams show that a systematic market and service offen-sive in saturated markets is a suitable means of ensuring survival in the face of competition.

Risks may arise from own business activity as well as through external factors. In the case of the French company Poly Implant Prothèse’s (PIP), TÜV Rheinland was mentioned as Notifi ed Body in connection with conformity assessment proce-dures according to the European Medical Devices

Directive for CE marking. PIP had continually de-ceived TÜV Rheinland in that they were using a silicone gel to produce its implants that was not approved for that purpose. Immediately after ob-taining knowledge of the fraud, TÜV Rheinland suspended its certification and initiated legal action against PIP. In 2012, claims were asserted both judicially and extrajudicially. According to TÜV Rheinland’s legal opinion, these claims are unfounded, as there is no conduct giving rise to liability.

In Germany, in addition to general economic risks, exempting educational services from the value-added tax can have a deleterious effect on the area of Professional Training. This risk is countervailed by potentials from an even stron-ger interconnection of sales-related and admin-istrative processes following the acquisition of the campus Group. Furthermore, opportunities exist due to additional growth in defi ned foreign markets.

General imponderables exist with regard to the stability of international finance systems and possible effects on the economy. In this regard, the high and still-rising proportion of interna-tional sales has a risk-reducing effect. This is also true for political instabilities, as are currently oc-curring in the Near and Middle East. Moreover, progressive consolidation in the TIC industry combined with pressure on prices and mar-gins and fiercer competition pose an ongoing challenge.

In Middle and Eastern Europe, ambitious growth and yield targets continue to face relatively dif-ficult economic framework conditions which are countervailed by strategic and operational changes. However, a change of this kind will at least temporarily involve a risk of falling margins.

The associated risks will be manageable or their unwanted effects will be weakened by TÜV Rhein land’s distinctive business and

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regional diversifi cation as well as its systematic risk management. Due to the integration of risk management into TÜV Rheinland’s manage-ment information system, risk is controlled by appropriate evaluation on a universal basis in all businesses and Business Streams as well as on the Group level.

The Executive Board has set up a risk unit to which the Controlling, Finance, Corporate Au-dit, Legal, Quality Management, Compliance, and Insurance Divisions belong. Its remit is to analyze and evaluate the individual opportu-nities and risks. Targeted countermeasures are undertaken comprehensively at an early stage to minimize risks and strengthen opportunities. In addition to market, customer, and competi-tion issues, this particularly relates to internal processes (such as integration tasks after M&A transactions) and to personnel in terms of the shortage of qualifi ed staff, for example. Continu-ous action tracking and updating of opportuni-ty and risk reports in the course of the year are obligatory.

TÜV Rheinland counteracts liquidity risk by means of active financial management, the overriding objective of which is to ensure that all Group companies are solvent at all times. Specifi cally, this includes systemic working capi-tal and treasury management. The latter partic-ularly includes implementing cash pooling and in-house banking. Financial derivatives are used to hedge currency and interest rate risks.

As far as possible, risks are hedged by taking out insurance cover to minimize at least their fi nan-cial consequences up to a defined percentage share.

OUTLOOK

Future Economic Conditions

Recovery of economic development will gradu-ally set in during 2013. Economic experts at the International Monetary Fund (IMF) anticipate 3.5% growth in the global gross domestic prod-uct. With regard to the sovereign debt crisis in the eurozone it is expected that the situation on the fi nancial markets will slowly ease once again. In the industrialized countries, monetary policy will continue to provide impetus, as interest rates are expected to remain at an extremely low level. However, fi nancial policy in 2013 will continue to have a dampening effect, which – due to con-solidation efforts in the eurozone and planned deficit reduction in the United States – will be strongly contractionary. In the United States, a successive improvement of the capital situation in private households and a further stabilization of real estate prices is expected in 2013. However, planned tax increases and spending cuts for bud-get consolidation will have a dampening effect. Nevertheless, a slight upward trend for the econ-omy in the United States is expected. Due to in-creasingly expansive monetary policy, economic growth in developing countries is expected to accelerate during 2013. Overall, the economic recovery during the outlook period will progress further, although this will proceed very differ-ently in the individual economic spheres.

In 2013, the European economy will gradually stabilize again. On the one hand, this is suggested by an improvement of company sentiment at the end of 2012. On the other hand, a reduction of uncertainty with regard to the further progres-sion on the European sovereign debt crisis is ex-pected due to the latest consolidation successes. Because of consolidation efforts, the budget defi -cit will fall noticeably in 2013. However, a 0.2% decline of gross domestic product is expected for the eurozone. In 2013, dampening effects for the economy will emanate from fi nancial policy, in particular, which will continue to have a clearly

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Opportunity and Risk Report

Outlook

restrictive orientation. The unfavorable finan-cial conditions in some countries give reason to expect a reduction of corporate investments. Furthermore, declining real wages will result in weaker demand for consumer goods. In addition, a further increase in the unemployment rate is expected for 2013. The recession is expected to continue in Spain, Italy, and Portugal.

In Germany, gross domestic product is only ex-pected to grow 0.6% in 2013. This means that, as in the previous year, economic growth is mov-ing at a relatively low level. Reasons for this de-velopment are a slowing of the world economy and the adjustment recessions in the eurozone, which are severe in some cases. Despite other-wise favorable framework conditions, which are due to a low interest level, among other factors, a period of weakness can therefore be initially ex-pected. However, fi rst signs suggest a slow recov-ery of the German economy, which is supported by expected moderate growth of the world econ-omy. The calming of the fi nancial markets and an expected increase of private consumer spend-ing will, in all likelihood, have a positive infl u-ence on the German economy. In addition, ex-port opportunities for companies are again seen more positively. After important indicators for Germany – like the Ifo Business Climate Index – had deteriorated considerably during the course of the year, the business climate stabilized again toward the year’s end. Business prospects are now considered more positive altogether. Due to macroeconomic weakening, the situation on the labor market in 2013 will worsen slightly and the unemployment rate is expected to rise to 7.2%. After the overall government budget was nearly balanced in 2012, a noticeable defi cit is expected in 2013 due to the period of economic weakness. The deficit rate in 2013 is expected to be about 0.5%. However, overall these estimates depend to a signifi cant extent on the manageability of the European debt crisis and the attendant sustained calming of the fi nancial markets.

TÜV Rheinland Group Forecast

Against the background of slightly increasing economic growth in 2013, the TÜV Rheinland Group expects its successful development to continue. Forecast scenarios show that even in the unexpected event of a crisis like we saw in 2009, the TÜV Rheinland portfolio is robust enough to record only slight declines in income and no signifi cant declines in revenue.

In this environment, revenue growth in the cur-rent year 2013 is expected to be similar to what it was in 2012. The annual result should rise again, as will the employee headcount.

High revenue growth is expected in the Indus-trial Services Business Stream, which will be driven predominantly by international business and new acquisitions, but also by the Germany’s reliable domestic market. This market continues to show positive development at its already high level. The focus markets continue to be energy, oil, gas, and infrastructure. The highest growth rate is expected in Asia Pacific, IMEA, and the Americas.

The Mobility Business Stream will post slight-ly below-average growth. In Germany, solid growth will continue in all Business Fields. Strong revenue growth is expected throughout Asia as a result of testing labs that have been put into operation. Additionally, the Rail Busi-ness Field is developing well in IMEA and North America.

For the Products Business Stream, higher rev-enue growth is expected after a weaker previ-ous year. This applies to business in Germany, but especially to international regions. In this, the addition of new labs in the IMEA will make a signifi cant contribution. Aside from the tradi-tional Business Fields such as Solar Testing and Softlines, services in the innovative fields of wireless communications, LED, and smart grid

96


will again account for additional growth. New process control software will continue to be in-troduced worldwide.

The Life Care Business Stream plans further at-tractive business volume for 2013. In Germany, this is true both for the core business of occupa-tional safety/health management and for medi-cal center services.

International revenue will improve – in Europe but also worldwide, with increasing participa-tion in major facility construction projects and infrastructure across Business Streams.

The Training and Consulting business steam will continue to grow considerably in the current year. This is true for all Business Fields. In Ger-many, acquisitions from the previous year will also contribute to this.

The share of international business will increase considerably. In all regions, the growth rates will be higher than in Germany.

The Systems Business Stream, which focuses on accredited and non-accredited certification of management systems, expects somewhat lower revenue growth compared with the previous year. This is true for Germany and Middle and Eastern Europe, Greater China, as well as Asia Pacific. The proven standards are at the fore-front, but they are also joined by newer stan-dards such as supply chain management, food safety, and energy management. Non-accredited services like mystery shopping, compliance, and service quality will also continue to improve.

The new process standard software will be intro-duced worldwide on the basis of uniform pro-cesses, which will be to everyone’s benefi t.

EVENTS AFTER THE REPORTING PERIOD

There are no events of particular significance after the end of the business year that will have a significant effect on the Group’s course of business.

Executive Board

Dr.-Ing. Manfred BayerleinChief Executive Offi cer

Thomas BiedermannChief Human Resources Offi cer and Director of Industrial Relations

Ulrich FietzChief Financial Offi cer Volker KlosowskiChief Technology Offi cer

Stephan SchmittChief International Offi cer

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Financial Report


Outlook

Events after the Reporting Period

Income Statement

In ‘000 € Note 2011 2012

Revenues (10) 1,417,790 1,528,900

Inventory changes (10) –751 2,472

Cost of purchased services –181,826 –205,772

Operating performance 1,235,213 1,325,600

Personnel expenses (11) –786,537 –858,624

Amortization of intangible assets and depreciation of property,

plant, and equipment (12) – 47,231 – 54,018

Other expenses (13) –312,616 –339,564

Other income (14) 35,208 39,790

Operating result 124,037 113,184

Interest income 17,377 16,637

Interest expenses –37,957 –36,211

Other financial result 188 462

Financial income (16) –20,392 –19,112

Earnings before tax 103,645 94,072

Income taxes (17) –36,626 –36,248

Consolidated net income 67,019 57,824

Thereof attributable to:

TÜV Rheinland Aktiengesellschaft equity holders 63,932 52,986

Non-controlling interests (18) 3,087 4,838

Earnings per share in € (19) 1,827 1,514

CONSOLIDATED FINANCIAL STATEMENTS TÜV RHEINLAND AKTIENGESELLSCHAFT FOR 2012

98


Balance Sheet

In ‘000 € Note 2011-12-31 2012-12-31

Assets

Intangible assets (20) 210,303 238,834

Property, plant, and equipment (21) 404,138 409,198

Other financial assets (25) 265,539 267,976

Other non-current assets (26) 12,151 11,014

Deferred tax assets (17) 28,489 59,163

Non-current assets 920,620 986,185

Inventories (27) 11,729 20,019

Trade receivables (28) 226,134 266,036

Income tax receivables (28) 12,463 5,888

Other receivables and other current assets (28) 84,367 85,526

Cash and cash equivalents (29) 93,157 88,369

Current assets 427,850 465,838

Total assets 1,348,470 1,452,023

Equity and liabilities

Issued capital 35,000 35,000

Capital reserves 23,802 23,802

Other reserves 255,616 217,223

Non-controlling interests (18) 10,853 15,744

Equity (31) 325,271 291,769

Provisions for pensions and similar obligations (32) 555,865 656,302

Other non-current provisions (33) 13,479 14,948

Non-current liabilities (34) 107,363 119,113

Deferred tax liabilities (17) 13,489 17,082

Non-current liabilities 690,196 807,445

Current provisions (33) 64,778 72,518

Income tax liabilities (34) 24,990 26,480

Trade liabilities (34) 92,423 109,313

Other current liabilities (34) 150,812 144,498

Current liabilities 333,003 352,809

Total equity and liabilities 1,348,470 1,452,023

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Financial Report

Consolidated Financial Statements

Income Statement

Balance Sheet

Cash Flow Statement*

In ‘000 € 2011 2012


Amortization/write-ups of intangible assets and depreciation/write-ups of property,

plant, and equipment 47,231 54,018

Depreciation/write-ups of financial assets 147 0

Change in non-current provisions –2,066 –3,867

Change in deferred tax assets and deferred tax liabilities 1,291 5,652

Profit/loss from the disposal of intangible assets and property, plant, and equipment –98 1,400

Other non-cash income/expense –9,335 –4,645

Change in inventories, receivables, and other assets –11,528 –33,268

Change in liabilities and current provisions 8,395 16,059

Cash flow from operating activities 101,056 93,173

Payments for investments in

Intangible assets and property, plant, and equipment –71,971 –73,944

Financial assets –19,033 –19,963

Shares in fully consolidated companies

(less cash and cash equivalents taken over)–10,486 –7,129

Receipts from disposal of

Intangible assets and property, plant, and equipment. 2,419 7,243

Financial assets 13,579 17,831

Shares in fully consolidated companies

(less cash and cash equivalents disposed of)2,395 0

Cash flow from investing activities –83,097 –75,962

Payments to equity holders –12,000 –15,600

Payments to minority interests –2,047 –3,420

Receipts from bank borrowings 19,345 24,700

Payments from lending from banks –32,329 –27,800

Cash flow from financing activities –27,031 –22,120

Change in cash and cash equivalents –9,073 –4,908

Change in cash and cash equivalents related to currency translation

and consolidation 1,310 120

Cash and cash equivalents at beginning of period 100,920 93,157

Cash and cash equivalents at end of period 93,157 88,369

* For further details, see Note (39).

100


Statement of Comprehensive Income

In ‘000 € 2011 2012

Actuarial profit/loss –19,194 –105,375

Available-for-sale financial assets (securities) –27 214

Gain or loss on foreign currency translation –1,761 –5,344

Cash flow hedges –493 –302

Deferred taxes 6,223 32,734

Other comprehensive income –15,252 –78,073


Consolidated comprehensive income 51,767 –20,249

Thereof attributable to:

TÜV Rheinland Aktiengesellschaft equity holders 49,055 –22,644

Non-controlling interests 2,712 2,395

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Financial Report


Cash Flow Statement

Statement of Comprehensive Income

Statement of Changes in Equity*

In ‘000 € Issued capital Capital reserves Retained earnings

As at 2011-12-31 35,000 23,802 214,805

Recognized income and expenses 0 0 51,296

Dividends paid 0 0 –12,000

Changes in basis for consolidation 0 0 –489

Minority transactions 0 0 –928

Other changes 0 0 0

As at 2012-12-31/2012-01-01 35,000 23,802 252,684

Recognized income and expenses 0 0 –17,302

Dividends paid 0 0 –15,600

Changes in basis for consolidation 0 0 –148

Minority transactions 0 0 0

Other changes 0 0 0

As at 2012-12-31 35,000 23,802 219,634

* For further details, see Note (31).

102


Other reserves

Foreign currency

translation

Available-for-sale

financial assets

(securities) Cash flow hedges

Equity before

minority interests

Non-controlling

interests Total

5,543 –10 –231 278,909 9,738 288,647

–1,887 –17 –337 49,055 2,712 51,767

0 0 0 –12,000 –2,047 –14,047

–129 0 0 –618 376 –242

0 0 0 –928 74 –854

15 0 –15 0 0 0

3,542 –27 –583 314,418 10,853 325,271

–5,248 118 –213 –22,645 2,394 –20,251

0 0 0 –15,600 –3,420 –19,020

0 0 0 –148 5,610 5,462

0 0 0 0 0 0

0 0 0 0 307 307

–1,706 91 –796 276,025 15,744 291,769

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Financial Report


Statement of Changes in Equity

GENERAL INFORMATION

(1) Fundamentals

The TÜV Rheinland Group is a leading interna-tional service provider that offers services in the Industrial Services, Mobility, Products, Life Care, Training and Consulting, and Systems Business Streams. Its services cover the areas of consult-ing, testing, certifi cation, and training.

TÜV Rheinland Aktiengesellschaft (AG) – head-quartered at Am Grauen Stein, 51105 Cologne, Germany – is registered as the Group’s parent company in the commercial register of the Co-logne District Court under HRB 23392.

The TÜV Rheinland Group’s consolidated fi-nancial statements were prepared in accordance with the International Financial Reporting Standards (IFRS) as applicable by publicly traded companies in the European Union and with the further applicable requirements of Section 315a of the German Commercial Code (HGB). The TÜV Rheinland AG Executive Board referred the consolidated fi nancial statements for the report-ing year 2012 to the Supervisory Board on Mon-day, March 18, 2013.

The reporting currency is the euro (€), and the reporting unit is €’000 (thousands of euros).

(2) Basis for Consolidation

In addition to TÜV Rheinland AG, Cologne, the consolidated financial statements cover 51 German (previous year: 47) and 81 interna-tional (previous year: 78) subsidiaries in which TÜV Rheinland AG directly indirectly holds a majority of the voting rights or otherwise exer-cises control over their financial and business policies.

Furthermore, two international (previous year: three) joint ventures were included in the cor-responding capital stock and one international associate (previous year: one) was included in the consolidated fi nancial statements using the equity method.

The basis for consolidation was expanded by the first-time inclusion of four German and three international affi liated companies. These addi-tions affect three acquisitions, one newly found-ed company, and three fi rst-time inclusions of companies not previously consolidated for rea-sons of materiality. The basis for consolidation was reduced by the merger of one international company.

The subsidiaries, joint ventures, and associates included in the consolidated financial state-ments are listed in Note (43) along with the consolidation method. The comprehensive list of the Group’s shareholdings included in the Notes is published in the electronic edition of the German Federal Gazette (Bundesanzeiger).

(3) Acquisitions

Effective July 1, 2012, the TÜV Rheinland Group acquired all of the shares in the campus GmbH Center of Competence (including two fully con-solidated subsidiaries). The company with head-quarters in Düsseldorf is a provider of certifi ed IT training for users, professionals, experts, and management. The purchase price was €9,952 thousand and is being paid in four interest-bear-ing tranches. Acquisition-related costs totaled €386 thousand and are stated as expenses in-curred during the reporting period.

Intangible assets totaling €4,429 thousand were stated as a part of the purchase price allocation. Goodwill amounted to €7,848 thousand as at July 1, 2012.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE REPORTING YEAR 2012

104


The acquisition will increase the expansion and development of the IT training business, partic-ularly internationally.

The consolidated fi nancial statements include revenues from the campus GmbH Center of Competence (including two fully consolidated subsidiaries) amounting to €10,140 thousand and income totaling €305 thousand for the pe-riod July 1 to December 31, 2012. If the acquisi-tion had been made at the beginning of the re-porting period, revenues amounting to €19,086 thousand and income totaling €339 thousand would have been realized.

Furthermore, effective April 1, 2012, the control-ling interest in Société Européenne de Contrôle Technique Automobile S.A. (SECTA), Cour-bevoie, was obtained and, as a result, was fully consolidated for the fi rst time, after the capital stock had already been increased from 35.1% to 50.51% in 2011. The acquisition serves the targeted expansion of our engagement in one of Europe’s most important automobile mar-kets. A positive difference of €4,475 thousand was expected in the course of reassessing the holding before the initial consolidation at fair value (€9,671 thousand). The consolidated fi-nancial statements include revenues amount-ing to €10,707 thousand and income totaling €1,361 thousand for the period April 1 to De-cember 31, 2012. If the acquisition had been made at the beginning of the reporting period, revenues amounting to €14,190 thousand and income totaling €1,831 thousand would have been realized.

At the time of acquisition, the assets and liabili-ties of the companies acquired in 2012 are as follows:

campus Group SECTA S.A.

In ‘000 €

Before

acquisition

After

acquisition

Before

acquisition

After

acquisition

Non-current assets 643 4,938 2,126 13,504

Cash and cash equivalents 37 37 3,182 3,182

Other current assets 6,237 6,237 2,288 2,288

Non-current liabilities 443 1,803 752 4,507

Current liabilities 7,306 7,306 3,024 3,024

(4) Consolidation Methods

(a) Subsidiaries

Subsidiaries are all companies, including special-purpose vehicles, in which the parent company TÜV Rheinland AG holds a controlling interest, control being defi ned as the ability to set a com-pany’s fi nancial and business policy in order to derive benefi t from it. This is regularly the case when the shareholding exceeds 50%. The exis-tence and effect of potential voting rights that can be currently exercised or converted are taken into consideration when assessing whether the possibility of exercising control exists.

Subsidiaries are principally included in the con-solidated financial statements (full consolida-tion) from the point in time when the opportu-nity to exercise control has been transferred to TÜV Rheinland AG. They are deconsolidated at the point in time when this opportunity ceases to apply. The balance sheets of subsidiaries ac-quired are prepared according to the purchase method. The acquisition costs correspond to the fair value of the assets offered, the equity instru-ments issued, and the debts incurred or taken over at the time of the transaction plus costs directly attributable to the acquisition. Transac-tions between Group companies are eliminated. In the case of unrealized losses, these are seen as an indicator of the need to conduct an impair-ment test of the asset transferred. Subsidiaries’ accounting methods were amended wherever re-quired to ensure uniform accounting principles across the Group.

105


Financial Report

Notes to the Consolidated


General Information

(b) Associates

As at the end of the reporting period, one com-pany (previous year: one) on which TÜV Rhein-land AG can exercise material infl uence was in-cluded in the consolidated fi nancial statements pursuant to IFRS. The equity method as per IAS 28 was used for this associate.

(c) Joint Ventures

Joint ventures are companies managed jointly by at least two shareholders. TÜV Rheinland AG states holdings in joint ventures by means of quota consolidation as per IAS 31. As in the pre-vious year, all of the capital stock listed under Note (43) corresponds to the voting rights held.

(5) Foreign Currency Translation

The annual financial statements of consoli-dated companies prepared in foreign curren-cies are translated into euros on the basis of the functional currency concept. As the foreign subsidiaries are independently operating com-panies, the local currency is considered to be the functional currency. Balance sheet items are therefore translated as a matter of principle at the mid-market rate at the end of the report-ing period. Equity capital is the exception; it is translated at historic rates. Income and expense items are stated at annual average exchange rates. Currency differences arising from the translation of annual financial statements are treated as having no effect on profi t or loss and are stated under equity capital as other reserves.

The exchange rates of the most important cur-rencies for foreign currency translation devel-oped as follows:

Closing exchange rate

Annual average

exchange rate

As at

2011-12-31

As at 2012-12-31 2011 2012

Brazilian real (BRL) 2.416 2.695 2.322 2.513

Chinese yuan renminbi (CNY) 8.149 8.212 8.991 8.137

Japanese yen (JPY) 100.117 113.611 110.775 102.909

US dollar (USD) 1.294 1.318 1.392 1.291

New Taiwan dollar (TWD) 39.193 38.287 40.981 38.173

Hong Kong dollar (HKD) 10.051 10.219 10.835 10.014

South Korean won (KRW) 1,490.141 1,411.372 1,542.389 1,449.814

(6) Accounting Policies

The fi nancial statements of TÜV Rheinland AG and its subsidiaries are included in the consoli-dated fi nancial statements in accordance with the Group’s standard accounting methods. Statements are prepared as at the reporting date. Assets and liabilities are subdivided in the bal-ance sheet according to their due dates as ei-ther non-current (due dates more than a year after the reporting date) or current. The income

statement is prepared according to the nature of expense method, i.e. by cost categories. All expenses for goods and services incurred in the reporting year are shown against the income earned. Income and expenses do not necessar-ily occur in the same reporting year; this is taken into account using the changes in inventory method, allocating work in progress to the re-porting period at cost of manufacture.

106


Revenues consist mainly of income earned from services and are stated, insofar as the criteria are fulfi lled, in accordance with the percentage of completion (PoC) method as per IAS 18.20 in combination with IAS 11.22 et seq. For the most part, revenues are stated when the risk arising from the service provided is transferred to the customer. Revenues are also booked in accor-dance with the stage of completion of orders.

Goodwill is analyzed at least once a year for signs of value impairment in accordance with IAS 36, with the impairment tests being carried out on the basis of cash-generating units. In accordance with the management approach, the TÜV Rheinland Group’s cash-generating units are the individual Business Streams (Industrial Services, Mobility, Products, Life Care, Training and Consulting, and Systems).

The calculation basis is the cash-generating unit’s recoverable amount. It is calculated by means of the discounted cash fl ow (DCF) method with data from the medium-term or strategic planning approved by the management. No goodwill write-ups are made.

Goodwill is stated in the functional currency of the foreign unit acquired.

Negative differences are recognized in profi t or loss after a further review.

Other acquired intangible assets such as soft-ware and accreditations are carried at cost. Assets identifi ed as a part of purchase price al-locations, such as contractual relations with cus-tomers, brand rights, and bans on competition, are stated as acquired intangible assets at fair value on receipt, insofar as the criteria of IFRS 3 and IAS 38 are fulfi lled.

Internally generated intangible assets such as software or development projects are stated at cost of manufacture if they fulfi ll the capitaliza-tion criteria of IAS 38. Costs of manufacture are costs directly attributable to the development stage and borrowing costs if IAS 23 requires them to be capitalized. Research costs are re-corded as current expenses.

Intangible assets with a finite useful life are amortized on a straight-line basis over a period of between three and 20 years. If there are indi-cations of value impairment and if the recover-able amount is lower than the amortized costs of acquisition or manufacture, extraordinary impairment of the intangible assets is taken. If the reasons for this extraordinary impairment no longer apply, corresponding write-ups are undertaken. Intangible assets with an indefi nite useful life are not subjected to systematic amor-tization, but are checked for value impairment at least once a year.

Property, plant, and equipment is stated at ei-ther cost of acquisition or cost of manufacture (including borrowing costs if IAS 23 requires them to be capitalized) less scheduled or ex-traordinary write-downs. Scheduled deprecia-tion is principally undertaken in accordance with the straight-line method. Buildings and building components are amortized over 80 years at most and other tangible fi xed assets are amortized over three to 15 years. In Germany, low-value assets are included in an annual com-pound item at the time of addition and one fi fth of the amount is written off in the fi rst year and one fifth in each of the next four years. If there are indications of value impairment and if the recoverable amount is lower than the amortized costs of acquisition or manufacture, extraordinary impairment of property, plant, and equipment is taken. If the reasons for these extraordinary write-downs no longer apply, cor-responding write-ups are undertaken.

107


Financial Report



General Information

If, from an economic viewpoint, the majority of risks and opportunities in connection with rented or leased property, plant, and equipment are transferred to the tenant (lessee), these items must be recognized in the lessee’s IFRS balance sheet in accordance with IAS 17 and a corre-sponding liability must be stated for the fi nance lease.

Rental agreements that, from an economic view-point, do not transfer the majority of risks and opportunities in connection with the leased as-sets are classifi ed as operating leases.

In accordance with IAS 27 in combination with SIC 12, TÜV Rheinland Grundstücksgesellschaft Nürnberg mbH & Co. KG and TÜV Rheinland Grundstücksgesellschaft mbH & Co. KG were classifi ed as special-purpose leasing vehicles for TÜV Rheinland AG’s consolidated IFRS fi nancial statements due to the majority of risks being borne or the majority of opportunities being gained.

On the basis of the IAS 39 categories, fi nancial assets are classified as loans and receivables, available-for-sale fi nancial assets, and fi nancial assets at fair value through profit or loss. The held-to-maturity valuation category does not oc-cur at the TÜV Rheinland Group. Classifi cation depends on the purpose for which the fi nan cial assets were purchased. The management speci-fi es the classifi cation of fi nancial assets on fi rst stating them and reviews it at the end of every reporting period. The initial measurement of fi nancial assets is at fair value. Ordinary market purchases are stated uniformly on the trading date. The TÜV Rheinland Group does not make use of the fair value option.

Receivables stated as trade receivables, other receivables, and other assets are classified as loans and receivables in accordance with IAS 39. They are subsequently valued at amortized cost using the effective interest method.

Securities and investments in companies that are mainly stated under other financial assets and in which a material influence is not held are classifi ed as available-for-sale fi nancial assets in accordance with IAS 39. If these securities or shares are traded in an active market, the fair value is the market price as at the end of the reporting period. If there is no active market, the fair value is established by means of suitable valuation techniques. Assets for which there is no fair value or a fair value cannot be established are carried at cost of acquisition. Changes in fair value are shown without effect on profi t or loss in the consolidated statement of comprehen-sive income. On disposal, the proceeds stated in the consolidated statement of comprehensive income are transferred to the income statement.

If there is objective evidence of a material or permanent value impairment of assets classifi ed as loans and receivables or as available-for-sale fi nancial assets, they are amortized and recog-nized in profi t or loss.

Financial derivatives that are not part of effec-tive hedge accounting as per IAS 39 are classi-fi ed as fi nancial assets or liabilities at fair value through profi t or loss. First-time and subsequent measurements are at fair value, with changes recognized in profi t or loss. Financial derivatives that form part of effective hedge accounting are also stated at fair value in either the income statement or the consolidated statement of com-prehensive income, depending on the nature and characteristics of the hedge.

108


At the TÜV Rheinland Group, fi nancial deriva-tives are used in principle to hedge currency and interest rate risks. The fair value of interest rate swaps is established by means of third-party bank appraisals based on the respective DCF valuation techniques. The requisite parameters are, without exception, market values.

Financial derivatives are stated in the balance sheet from the time when the company becomes a party to the contractual provisions.

The TÜV Rheinland Group uses hedge account-ing in accordance with the relevant IAS 39 pro-visions to hedge future cash fl ow. The effective portion of the change in market value of the derivative used as a hedge is stated in the consol-idated statement of comprehensive income. The ineffective portion and changes in market value of derivatives that do not fulfill the require-ments of hedge accounting are stated directly in the income statement.

Actuarial reserve quotas shown under other financial investments are reimbursements as defi ned in IAS 19 and are stated at fair value in accordance with this standard. Income from reimbursement claims is shown in the fi nancial result. Actuarial profi t/loss is taken into consid-eration in the consolidated statement of com-prehensive income.

Tax deferrals and accruals are undertaken on temporary (and quasi-permanent) differences between the values stated in the IFRS and fis-cal balance sheets and on certain consolida-tion measures. Tax deferrals are also made on loss carryovers, interest carried forward, and tax refund entitlements insofar as they are rea-sonably certain to be realized. Tax deferrals are not undertaken, however, if they result from

the first-time statement of an asset or a liabil-ity in connection with a transaction that is not a business combination and, at the time of the transaction, infl uenced neither the accounting profi t nor the taxable profi t (tax loss). The TÜV Rheinland Group states deferred tax liabilities resulting from temporary differences in con-nection with shareholdings in subsidiaries and associates, except when it can decide the time when the temporary differences will be reversed, and it is unlikely that the temporary differences will be reversed in the foreseeable future due to this infl uence. Tax deferrals are determined on the basis of the tax rates that are expected to apply at the time of realization. Deferred tax as-sets are written down if future realization of the tax advantages is unlikely. This is assessed on the basis of taxable income in the years ahead as planned and considered to be likely by the company in question. Deferred tax assets and liabilities are offset in the balance sheet insofar as the conditions for offsetting are fulfi lled. De-ferred tax assets and liabilities are stated as non-current items.

Inventories are stated at the lower of cost of acquisition or manufacture and – to the extent available – net realizable value. The cost of man-ufacture of work in progress comprises the cost of materials used, third-party services, directly attributable personnel costs, other direct costs, and overhead attributable to the provision of services. The net realizable value is the estimated sale proceeds realizable in the normal course of business less the estimated necessary selling expenses.

Trade receivables and other receivables are sub-sequently valued at amortized cost of acquisi-tion. If necessary, however, appropriate valua-tion allowances are made. Use is made of both

109


Financial Report



General Information

individual and collective valuation allowances (global valuation allowance) with recourse in both cases to a valuation allowance account. Irrecoverable receivables are amortized. To establish fl at-rate specifi c valuation allowances, financial assets for which a potential write-down requirement exists are grouped by simi-lar default properties and jointly investigated for allowances and written down if required. In establishing future expected cash fl ows, consid-eration is given not only to contractually pro-vided cash fl ow, but also to historic experience of default.

Receivables from service agreements that have yet to be invoiced are stated using the PoC method in accordance with IAS 18.20. The stage of completion per order is calculated on the basis of the ratio of costs incurred to calculated total costs (the cost-to-cost method). If the result of a construction contract cannot be reliably established, income is only stated to the amount of costs incurred (the zero profi t method). Im-pending losses from work in progress are taken into account if they are foreseeable and deduct-ed directly from the receivables involved. If the result is a negative balance, it is stated under liabilities from PoC. Advance payments received toward customer orders are stated under current liabilities.

Other receivables and other assets are stated at cost of acquisition less value impairment. In-dividual valuation allowances are undertaken within the scope of the anticipated credit risks.

Cash and cash equivalents are allocated to the loans and receivables category in accordance with IAS 39 and comprise cash and other current liquid fi nancial assets with an original term of three months at most. They are stated at a fair value that corresponds to their nominal value.

Non-current assets held for sale are individual assets held with the intention of disposal. They are stated at the lower of the carrying amount or fair value less cost of sale.

Pension commitments and similar obligations are stated for defined benefit pension plans in accordance with the actuarial entitlement cash value procedure or the projected unit credit method. Future obligations are assessed using actuarial processes and a prudent assessment of the relevant parameters. Provisions for pen-sions are created on the basis of pension plans for old age, disability, and survivor benefi t com-mitments. The TÜV Rheinland Group’s com-mitments vary according to the legal, fi scal, and economic circumstances in the country in ques-tion and, as a rule, are based on the employee’s length of service and remuneration. Commit-ments consist of both current and projected pensions. Pension commitments are offset against plan assets in the balance sheet.

Actuarial profi ts or losses are the result of inven-tory changes and deviations of actual trends, such as income and pension increases, from the valuation assumptions. They are stated, taking deferred taxes into account, in the consolidated statement of comprehensive income. The service cost is stated under personnel expenses. Interest expenses and income from plan assets or reim-bursement claims are shown in the financial result. The expert reports on the basis of which pension commitments are calculated are almost exclusively those drawn up by Heubeck AG, Cologne.

Miscellaneous provisions are created insofar as legal or actual obligations to third parties due to past events exist that are likely to lead to an out-fl ow of funds and the amount involved can be reliably estimated.

110


Non-current provisions are stated at the pres-ent value of the probable cash outflows with accrued interest added for the period leading up to when they are expected to be utilized.

If an estimate is amended and the estimated commitment is reduced as a result, the provi-sion is appropriated accordingly. Insofar as con-tractual dismantling and removing obligations exist within the TÜV Rheinland Group, these commitments are endorsed for the asset in ques-tion, and the additional scheduled depreciation and interest expense arising from pro rata con-tributions to the reserve will affect the income statement.

Trade liabilities, other fi nancial liabilities, and nonderivative liabilities shown under miscel-laneous liabilities are stated at fair value less transaction costs on fi rst mention and are sub-sequently carried at amortized cost using the effective interest method.

The accounting and measurement of fi nancial derivatives with negative fair values corresponds to the accounting and measurement of fi nancial derivatives with positive fair values.

(7) Estimates

Drawing up consolidated financial statements requires assumptions or estimates to be made in respect of various items for measurement in the balance sheet, for the statement of contingent liabilities, and for the statement of income and expenses. They relate especially to pension com-mitments and other reserves, to the amount of goodwill, and to the statement of deferred tax assets for loss carryovers. The actual fi gures can differ from these estimates.

Impairment tests of goodwill are undertaken at least once a year on the basis of the smallest cash-generating unit that has been allocated to the goodwill and of the management’s approved three-year operational plan, assuming long-term growth rates for the reporting units in ques-tion over the following period. Not even a 10% reduction in the derived cash flows, on which the calculation of the value in use of the cash-generating units is based, would lead to extraor-dinary amortization.

Obligations arising from defined benefit pen-sion commitments and from the following year’s pension costs are calculated on the basis of the actuarial parameters mentioned in Note (32). The change in parameters would not, how-ever, infl uence the current year’s consolidated profit because actuarial profits and losses are stated in the consolidated statement of compre-hensive income.

For the other balance sheet items, a change in the basis of the original estimate leads to a change in the balance sheet item in question that affects net income. Details of the exercise of discretionary judgment are included in the indi-vidual notes.

(8) First-Time Application of

Accounting Standards

The following IASB pronouncements were ap-plied for the fi rst time in the reporting year:

p Revised version on IFRS 7 »Financial Instru-ments: Disclosures« (Amendment: »Reclassi-fi cation of Financial Assets«); p Revised version of IAS 12 »Income Taxes«

(Amendment: »Deferred Taxes: Recovery of Underlying Assets«); p Revised version of IFRS 1 »First-time Adop-

tion of International Financial Reporting Standards« (Amendment: »Severe Hyperinfl a-tion and Removal of Fixed Dates for First-time Adopters«)

111


Financial Report



General Information

The revised version of IFRS 7 contains additional disclosure requirements in the event that at the end of the reporting period either transferred but not yet derecognized fi nancial assets exist or a continuing involvement still exists during the transfer of fi nancial assets.

As part of the amendment to IAS 12, a procedure is described for determining deferred taxes in investment property, which are evaluated subse-quent to the fair value.

The revised version of IFRS 1 contains additional requirements for the first-time use of the IFRS in the event that the functional currency of the reporting entity before the date of transition was a currency with pronounced hyperinfl ation.

All of the aforementioned rule changes have no effect on the TÜV Rheinland Group’s assets, fi nancial position, profi tability, or cash fl ows.

(9) Accounting Standards Not Applied

For the IFRS consolidated financial statements as at Monday, December 31, 2012, no interpre-tations, new, or revised standards were applied voluntarily that are mandatory for reporting years beginning on or after January 1, 2013. The standards and interpretations in question are as follows:

Mandatory initial application in the reporting year 2013:

p Revised version of IAS 1 »Presentation of Financial Statements«; p Revised version of IAS 19 »Employee Benefi ts«; p IFRS 13 »Fair Value Measurement«; p Revised version of IFRS 7 (Amendment: »Dis-

closures – Offsetting Financial Assets and Financial Liabilities«);

p Revised version of IFRS 1 »First-time Adoption of International Financial Reporting Stan-dards« (Amendment: »Government Loans«); p »Improvements to International Financial Re-

porting Standards« (published in 2012; not yet adopted by the EU); p IFRIC 20 »Stripping Costs in the Production

Phase of a Surface Mine«.

Mandatory initial application in the reporting year 2014 or later:

p Revised version of IAS 27 »Consolidated and Separate Financial Statements« (in the future: »Separate Financial Statements«); p Revised version of IAS 28 »Investments in

Associates« (in the future: »Shares in Associ-ates and Joint Ventures«); p IFRS 10 »Consolidated Financial Statements«; p IFRS 11 »Joint Arrangements«; p IFRS 12 »Disclosures of Interests in Other

Entities«. p Revised versions of IFRS 10, IFRS 11, and IFRS

12 (Amendment: »Consolidated Financial Statements, Joint Arrangements, and Disclo-sure of Interests in Other Entities: Transition Guidance« and »Investment Entities«; not yet adopted by the EU); p Revised version of IAS 32 (Amendment: »Pre-

sentation – Offsetting Financial Assets and Financial Liabilities«); p IFRS 9 »Financial Instruments« (not yet

adopted by the EU); p Revised versions of IFRS 9 and IFRS 7 (Amend-

ment: »Mandatory Effective Date and Transi-tion Disclosures«; not yet adopted by the EU).

The pronouncements listed above will fi rst be ad-opted in the TÜV Rheinland Group when their application becomes mandatory. Application of International Financial Reporting Standards presupposes that the European Union endorses them, which is not yet the case in every instance.

112


Additionally, the TÜV Rheinland Group does not, as yet, apply IFRS 8 (Operating Segments); applying it is mandatory only for publicly traded companies.

These amendments will probably have no mate-rial effect on the presentation of the TÜV Rhein-land Group’s assets, financial position, profit-ability, or cash fl ows.

The latter is also true for the revised version of IAS 19 that must be used from the reporting year 2013, although the standard is the framework for regulating the accounting of provisions for pen-sions and similar obligations (see Note (32)) and the other personnel provisions listed under Note (33), which are essential for the TÜV Rheinland Group. In this regard, the revised version of IAS 19 ensures the following changes:

p Regarding the accounting of provisions for pensions, from the reporting period 2013 the anticipated income (estimated at the end of the previous reporting period) from plan as-sets or reimbursements is no longer stated as interest income in the income statement. Instead, the interest income for the report-ing period is determined on the basis of the actuarial interest rate which is used to dis-count the pension commitment at the end of the previous reporting period. The difference between the actual income for the reporting period from plan assets or reimbursements and the interest income determined on the basis of the actuarial interest rate represents a gain or loss from the reassessment of the plan assets or the reimbursements, which should be stated outside the income statement, in the consolidated statement of comprehen-sive income. The interest income stated for the reporting year 2013 in the consolidated statement of comprehensive income as de-termined by the initial application of the amended IAS 19 is approximately €3.4 million lower.

p In the accounting of the remaining personnel provisions, there could be changes regarding the amount of the stated commitments from partial retirement agreements. On the basis of the previous regulations, supplementary amounts are treated as termination benefi ts, meaning that they are stated as a liability in the full amount at the time of the contribu-tion plan. With the revised version of IAS 19, the definition of termination benefits has been changed; subsequent to the revision, they include no payments in exchange for future work performance. However, the lat-ter may also apply to the supplementary amounts, which would mean that they would no longer need to be designated as termina-tion benefits but rather, as other long-term employee benefits over the vesting period, as a provision. The partial retirement agree-ment, which may have been overestimated on the basis of the revised IAS 19, would have to be partially appropriated outside the income statement and subsequently recre-ated over the remaining vesting period using the income statement. Because in the TÜV Rhein land Group the existing partial retire-ment contracts are largely fulfi lled, the future expense possibly resulting from this is not material to the assessment of the TÜV Rhein-land Group’s assets, financial position, and profi tability.

113


Financial Report



General Information

NOTES TO THE INCOME STATEMENT

(10) Revenues

Revenues including inventory changes are earned in the individual Business Streams and regions as follows:

Revenues by Business Stream

In ‘000 € 2011 2012

Industrial Services 453,323 487,621

Mobility 335,801 365,949

Products 372,080 396,405

Life Care 51,477 54,521

Training and Consulting 159,522 194,070

Systems 126,615 118,268

Total 1,498,818 1,616,834

Intra-Group revenues and

central functions/Other –81,779 –85,462

Total 1,417,039 1,531,372

Revenues by Region

In ‘000 € 2011 2012

Germany 787,902 814,152

Europe (excluding Germany) 165,246 171,263

Asia (including India, the

Middle East, and Africa) 274,026 329,328

America 189,866 216,629

Total 1,417,039 1,531,372

Revenues mainly relate to service agreements. They include the proceeds of service agreements not yet definitively invoiced, totaling €27,156 thousand (previous year: €29,874 thousand), which were realized according to the percentage of completion.

(11) Personnel Expenses

In ‘000 € 2011 2012

Wages and salaries 657,431 717,200

Social security and

other benefit costs 117,479 125,962

Pension expenses 11,627 15,462

Total 786,537 858,624

The TÜV Rheinland Group’s personnel expens-es include €20,788 thousand (previous year: €22,270 thousand) for employees whose con-tracts are managed at LGA KdöR. Group employ-ees are for the most part salary earners.

Employee Capacity Annual Average

2011 2012

Group employees 15,961 17,218

of which with LGA KdöR 321 297

of which with companies

included proportionately 219 166

(12) Amortization of Intangible Assets and

Depreciation of Property, Plant and

Equipment

In ‘000 € 2011 2012

Scheduled depreciation

of intangible assets 7,268 9,586

of property, plant, and

equipment 39,955 44,432

Total 47,223 54,018

In the reporting year, extraordinary write-downs in the amount of €0 (previous year: 8 thousand) were recorded, of which €0 (previous year: €8 thousand) was of property, plant, and equipment.

114


(13) Other Expenses

Other expenses amounting to €339,564 thou-sand (previous year: €312,616 thousand) con-sist mainly of rents, leases, leasing costs, travel costs, postage costs, real estate maintenance and advertising costs, consumables, auditing and consulting costs, repair and maintenance costs, vehicle costs, and impairment losses on exchanges. This item also includes other tax expenses totaling €5,965 thousand (previous year: €6,020 thousand).

(14) Other Income

Other income amounting to €39,790 thousand (previous year: €35,208 thousand) consists mainly of income from the reversal of provi-sions, exchange rate gains, income from servic-es, income from reducing valuation allowances on receivables, other services, and rental income and income from ancillary business.

(15) Amortization of Goodwill

As in the previous year, no amortization of goodwill was required.

(16) Financial Result

In ‘000 € 2011 2012

Interest income* 4,684 3,763

Interest expenses from

financial liabilities –10,026 –8,714

Net funding figure for

pension commitments –15,238 –14,623

Net interest income –20,580 –19,574

Write-downs on investments –148 0

Profit (loss) from dividend

distributions/profit and loss

transfer agreements 159 407

Profit (loss) from other

securities 211 121

Profit (loss) from financial

derivatives –34 –66

Other financial result 188 462

Total –20,392 –19,112

* Excluding interest income in the net funding figure for pension

commitments.

The net funding figure for pension commit-ments is the interest costs of pension commit-ments after deduction of income from plan assets and reimbursements.

Total interest expenses from financial assets and financial liabilities not carried at fair value through profit or loss in the reporting year amounted to €8,663 thousand (previous year: €9,993 thousand). Total interest income was €3,763 thousand (previous year: €4,684 thousand).

(17) Income Tax

In ‘000 € 2011 2012

Actual taxes 36,918 36,687

Deferred taxes –292 –439

from temporary differences 1,214 3,636

from loss carryovers –1,506 –4,075

Total 36,626 36,248

The following TÜV Rheinland Group reconcilia-tion combines the individual, company-related reconciliation statements with their country-specifi c tax rates, taking consolidation measures into account. The anticipated tax expense is rec-onciled to the actual tax expense.

115


Financial Report



Notes to the Income Statement

Reconciliation

In ‘000 € 2011 2012

Earnings before income tax 103,645 94,072

Anticipated tax rate 32 % 32 %

Anticipated income tax expenditure 32,917 29,703

Tax rate differences –4,232 –2,878

Tax increases due to non-

deductible expenses 3,581 4,439

Tax arrears payments/refunds

for previous years (incl. tax

effect of trade tax) 1,024 743

Losses for which no tax as-

sets could be stated in the

previous year, plus changes in

valuation allowances 2,244 2,779

Effect of tax rate changes 228 48

Other differences 864 1,414

Stated income tax expendi-ture 36,626 36,248

Actual tax burden 35.3 % 38.5 %

The tax rate paid by the parent company TÜV Rheinland AG was taken as the anticipated tax rate. It amounts to 31.575% and consists of the German corporation income tax rate (15.0%) plus the 5.5% solidarity surcharge and an aver-age trade tax rate of 450.0%. Foreign tax rates range from 10.0% to 40.07%.

Tax deferrals and accruals result from the follow-ing balance sheet items and loss carryovers:

Deferred Tax Assets

In ‘000 €

As at

2011-12-31

As at 2012-12-31




Special reserve with an equity

portion 0 0


Total 64,463 95,236

Amount offset per tax group –37,466 –40,148

Latente Steuern auf zeitliche

Bewertungsunterschiede 26,997 55,088

Latente Steuern auf steuerli-

che Verlustvorträge 3,124 5,994

Wertberichtigung auf latente

Steuern –1,632 –1,919

Total 28,489 59,163

Deferred Tax Liabilities

In ‘000 € 2011-12-31 2012-12-31




Special reserve with an equity

portion 217 209


Total 50,955 57,230

Amount offset per tax group –37,466 –40,148

Deferred taxes on valuation

differences 13,489 17,082

Deferred taxes on fiscal loss

carryovers 0 0

Impairment of deferred taxes 0 0

Total 13,489 17,082

116


The total of deferred tax assets is composed of current deferred tax assets totaling €7,226 thou-sand (previous year: €5,870 thousand) and of non-current deferred tax assets totaling €51,937 thousand (previous year: €22,619 thousand). The total of deferred tax liabilities is composed of current deferred tax liabilities totaling €1,060 thousand (previous year: €1,207 thousand) and of non-current deferred tax liabilities totaling €16,022 thousand (previous year: €12,282 thou-sand). Of the deferred taxes, €36,165 thousand (previous year: €–4,534 thousand) was offset against equity capital.

In the reporting year, deferred taxes on actuarial profi ts or losses of €–31,555 thousand (previous year: €6,059) were stated in the consolidated statement of comprehensive income. Con-cerning »Available-for-sale financial assets,« amounts totaling €14 thousand (previous year: €0) were booked. In addition, €–89 thousand (previous year: €–164 thousand) in deferred taxes was stated in the consolidated statement of comprehensive income in the reporting year in respect of cash fl ow hedges.

Within the TÜV Rheinland Group, unused tax carryovers totaling €42,208 thousand (previous year: €29,428 thousand) existed as at the end of the reporting period. Of this total, €4,075 thousand in deferred tax assets was recog-nized. Loss carryovers are for the most part not time-limited.

No deferred tax liabilities were created for tem-porary differences in shareholdings in subsidiar-ies and associates amounting to €3,118 thousand (previous year: €2,863thousand) because the TÜV Rheinland Group is able to control the time course of the reversal, and the temporary dif-ferences will not be reversed in the foreseeable future.

(18) Non-Controlling Interests

In ‘000 € 2011 2012

Shares in profits 3,444 5,030

Shares in losses –357 –192

Total 3,087 4,838

Losses attributable to non-controlling interests relate mainly to TUV Rheinland PTL LLC in Tempe, Arizona; profi ts relate mainly to SECTA S.A. in Courbevoie, France, LUXCONTROL S.A. in Esch/Alzette, and TÜV Rheinland/CCIC (Ningbo) Co., Ltd. in Ningbo, China.

(19) Earnings per Share

2011 2012

Earnings share of equity holder TÜV

Rheinland AG (in €’000) 63,932 52,986

Number of shares as at 12/31/2012

(in thousands) 35 35

Earnings per share (in €) 1,827 1,514

Potential shares that might dilute the result were not issued by TÜV Rheinland AG in the previous year, so diluted and basic earnings per share are the same.

117


Financial Report



Notes to the Income Statement

NOTES TO THE BALANCE SHEET

(20) Intangible Assets

Acquired intangible

In ‘000 € Goodwill

Concessions, industrial

property rights, and

similar rights

Acquisition/Manufacturing costs

As at 2011-01-01 173,034 69,012

Currency changes –1,817 444

Changes in basis for consolidation –527 –187

Addition by acquisitions 13,194 1,709

Additions 6,817 2,409

Disposals 0 642

Reclassifications 0 278

As at 2011-12-31/2012-01-01 190,701 73,023

Currency changes –1,816 –896

Changes in basis for consolidation 0 0

Addition by acquisitions 6,677 15,936

Additions 3,069 10,879

Disposals 276 3,035

Reclassifications 0 12,958

As at 2012-12-31 198,355 108,865

Amortization

As at 2011-01-01 27,200 36,854

Currency changes 0 503

Changes in basis for consolidation –246 –130

Scheduled depreciation 0 6,228

Impairment costs 0 0

Disposals 0 652

Write-ups 0 0

Reclassifications 0 –84

As at 2011-12-31/2012-01-01 26,954 42,719

Currency changes 0 –815

Changes in basis for consolidation 0 0

Scheduled depreciation 0 8,280

Impairment costs 0 0

Disposals 0 2,728

Write-ups 0 0

Reclassifications 0 0

As at 2012-12-31 26,954 47,456

Carrying amount as at 2012-12-31 171,401 61,409

Carrying amount as at 2011-12-31 163,747 30,304

118


assets

Other intangible assets

Internally generated

intangible assets Advances paid Total

484 5,435 3,511 251,476

0 256 2 –1,115

0 0 0 –714

0 0 0 14,903

20 179 9,628 19,053

8 193 0 843

0 0 –278 0

496 5,677 12,863 282,760

0 –368 –25 –3,105

0 0 0 0

168 0 0 22,781

14 735 3,954 18,651

2 1,220 11 4,544

14 0 –12,958 14

690 4,824 3,823 316,557

276 1,198 302 65,830

0 88 0 591

0 0 0 –376

80 903 57 7,268

0 0 0 0

10 194 0 856

0 0 0 0

0 84 0 0

346 2,079 359 72,457

0 –150 0 –965

0 0 0 0

153 1,123 30 9,586

0 0 0 0

2 639 0 3,369

0 0 0 0

14 0 0 14

511 2,413 389 77,723

179 2,411 3,434 238,834

150 3,598 12,504 210,303

119


Financial Report



Notes to the Balance Sheet

The goodwill carrying amounts are allocated to the following Business Streams that are, at the same time, cash-generating units:

In ‘000 € 2011-12-31 2012-12-31

Industrial Services 74,717 72,651

Mobility 45,282 47,905

Products 13,374 12,661

Life Care 7,792 7,798

Training and Consulting 1,712 9,549

Systems 20,870 20,837

Total 163,747 171,401

The concessions include a brand with an inde-terminate useful life and a carrying amount of €10,675 thousand that is being subjected to a value impairment test at the cash-generating unit level. It is a company brand of which the useful life was estimated as indeterminate, due to its comprehensive importance for the com-pany and its long history.

The internally generated intangible assets are software and development projects.

The impairment test of intangible assets, includ-ing goodwill, did not require any write-downs. A balanced average discount rate of 5.75% was used across the Group to establish value in use. An annual growth rate of 1.50% was forecast after the planning period.

Research and development expenditure totaling €93 thousand (previous year: €59 thousand) was recorded in the income statement for the report-ing year.

(21) Property, Plant, and Equipment

In ‘000 €

Acquisition/Manufacturing costs

As at 2011-01-01

Currency changes

Changes in basis for consolidation

Addition by acquisitions

Additions

Disposals

Reclassifications

As at 2011-12-31/2012-01-01

Currency changes


Addition by acquisitions

Additions

Disposals

Reclassifications

As at 2012-12-31

Impairment

As at 2011-01-01

Currency changes



Impairment costs

Disposals

Reclassifications

As at 2011-12-31/2012-01-01

Currency changes



Impairment costs

Disposals

Reclassifications

As at 2012-12-31

Carrying amount as at 2012-12-31

Carrying amount as at 2011-12-31

120


Real estate and

buildings

Technical plant

and machinery

Other plant,

operating, and office

equipment

Advances paid

and plants under

construction Total

400,368 152,632 119,630 8,874 681,504

–1,300 1,412 –329 163 –54

0 –245 –325 0 –570

69 741 21 0 831

11,011 18,245 12,531 11,131 52,918

2,224 2,586 4,777 2,155 11,742

4,484 5,693 486 –10,663 0

412,408 175,892 127,237 7,350 722,887

1,045 –936 –1,113 –339 –1,343

0 0 4 0 4

9 0 1,547 0 1,556

7,531 17,591 12,300 17,871 55,293

3,923 5,367 5,902 3,982 19,174

6,299 5,542 1,351 –13,192 0

423,369 192,722 135,424 7,708 759,223

112,612 89,172 83,719 1,250 286,753

334 1,531 145 –103 1,907

0 –207 –259 0 –466

13,595 15,229 10,938 193 39,955

0 3 5 0 8

1,801 2,804 4,598 205 9,408

3 137 –140 0 0

124,743 103,061 89,810 1,135 318,749

–64 –711 –564 –111 –1,450

0 0 0 0 0

13,678 18,394 12,212 148 44,432

0 0 0 0 0

1,427 5,027 5,160 92 11,706

145 –164 6 13 0

137,075 115,553 96,304 1,093 350,025

286,294 77,169 39,120 6,615 409,198

287,665 72,831 37,427 6,215 404,138

121


Financial Report




(26) Other Non-current Assets

Other non-current assets amounting to €11,014 thousand (previous year: €12,151 thousand) in-clude no value impairments.

(27) Inventories

In ‘000 € 2011-12-31 2012-12-31

Raw materials, consumables,

and supplies 1,945 2,094

Work in progress 8,678 16,075

Finished goods and goods for

resale 376 748

Advances paid for inventories 730 1,102

Total 11,729 20,019

(28) Receivables and

Other Current Assets

In ‘000 € 2011-12-31 2012-12-31

Percentage of completion

receivables 42,098 59,128

Other trade receivables 195,023 218,060

Allowances on trade

receivables –10,987 –11,152

Trade receivables 226,134 266,036

Income tax receivables 12,463 5,888

Receivables from affiliated

companies 51,454 45,470

Receivables from associates 535 617

Market value of financial

derivatives 144 0

Other securities 30 30

Other receivables and assets 32,204 39,409

Other receivables and other current assets 84,367 85,526

In ‘000 € 2011-12-31 2012-12-31

Other trade receivables 195,023 218,060

of which neither impaired

nor past due 125,650 136,788

of which past due but

not impaired

due within 180 days 47,077 58,000

due within 181 to 360 days 3,628 5,529

due in over 360 days 2,873 3,790

of which impaired 15,795 13,953

(22) Investment Property

In the reporting year, as in the previous year, the TÜV Rheinland Group held no investment property.

(23) Investments Accounted for Using the

Equity Method

TÜV Rheinland AG’s consolidated fi nancial state-ments contain one associate (previous year: one), which has been accounted for according to the equity method. The investment is of no mate-rial signifi cance for the presentation of the TÜV Rheinland Group’s assets, fi nancial position, or profi tability.

(24) Joint Ventures

The key balance sheet and earnings parameters of joint ventures are as follows in relation to the share held by TÜV Rheinland AG:

In ‘000 € 2011 2012





Revenues 9,837 6,596

Operating income 70 28

Operating expenses 8,604 6,085

Financial income 5 46

Financial expenses 34 35

(25) Other Financial Assets

In ‘000 € 2011-12-31 2012-12-31

Shares in affiliated companies 1,426 1,933

Other investments 924 1,104

Non-current securities 4,438 201

Actuarial reserve quota on the

basis of reinsurance policies 258,751 264,738

Total 265,539 267,976

No value impairment costs were recorded (previ-ous year: €148 thousand) in the reporting year.

122


Within the TÜV Rheinland Group, trade receiv-ables have been sold to an external credit institu-tion since 2006 as part of an asset-backed securi-ties transaction. As the disposal requirements of IAS 39 were not fulfi lled due to the retention of opportunities and risks (credit risks), the trans-action was carried in the same way as a secured loan with the result that the IFRS receivables in question have remained in the Group and

continue to be included in the balance sheet. The carrying amount of receivables sold as at the end of the reporting period was €16,469 thou-sand (previous year: €16,501 thousand), and after deducting reserves €15,000 thousand (pre-vious year: €15,000 thousand).

Impairment of trade receivables has developed as follows:

Individual valua-

tion allowances

Global valuation

allowances Total

In ‘000 € 2011 2012 2011 2012 2011 2012

Impairment as at 01-01 6,459 7,312 2,824 3,675 9,283 10,987

Addition 1,328 1,523 1,219 1,787 2,547 3,310

Use 201 786 470 29 671 815

Reversal 435 1,785 52 723 487 2,508

Other changes* 161 297 154 –119 315 178

Impairment as at 12-31 7,312 6,561 3,675 4,591 10,987 11,152

* Change in basis for consolidation, change in exchange rates, and reclassifications.

(29) Cash and Cash Equivalents

As in the previous year, this item consists of cash on hand, checks, and credit balances with banks that are available within three months.

(30) Non-current Assets Held for Sale

In the reporting year, no non-current assets were held by the TÜV Rheinland Group that are clas-sifi ed as non-current assets held for sale in accor-dance with IFRS 5.

(31) Equity Capital

As in the previous year, TÜV Rheinland AG’s is-sued capital amounts to €35,000 thousand and is divided into 35,000 registered shares, each with a value of €1,000.

The capital reserve consists mainly of the premi-ums charged on various capital increases since 1993.

Other reserves are the retained earnings and miscellaneous other reserves. Of the retained earnings, the past results of companies included

in the consolidated fi nancial statements are stat-ed unless previously distributed. In addition, re-tained earnings include the net proceeds of ad-justments, not recognized in profi t or loss, of the first-time adoption of IFRS. They also include the effect of offsetting actuarial profi ts and loss-es from pension commitments/plan assets and reimbursement claims against equity capital in the retained earnings.

Miscellaneous other reserves include differences arising from currency translation, not recog-nized in profit or loss, of the annual financial statements of international subsidiaries and the effects of taking items classifi ed as assets avail-able for sale directly to equity. In this regard, in the reporting year, earnings of €0 (previous year: €43 thousand) were transferred from eq-uity capital or from the consolidated statement of comprehensive income to the income state-ment. Miscellaneous other reserves also include the actual amounts transferred to equity capital in cash fl ow hedges.

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Financial Report




In addition to ensuring the company’s contin-ued existence as a going concern, the TÜV Rhe-inland Group’s capital management relating to IFRS equity capital as stated in the balance sheet aims to earn adequate interest over and above capital costs and thereby to permanently in-crease the corporate value.

TÜV Rheinland AG’s Articles of Incorporation make no special capital requirement provisions.

(32) Pension Commitments and

Similar Obligations

Occupational pensions at the TÜV Rheinland Group consist mainly of defined benefit plans. There are also defi ned contribution plans.

For defined contribution plans, the company pays contributions to state or private pension insurers on the basis of contractual provisions. In Germany, the pension schemes involved are Zusatzversorgungskasse der bayerischen Ge-meinden, Munich; Ruhegehalts- und Zusatzver-sorgungskasse des Saarlandes, Saarbrücken; and Versicherungsanstalt des Bundes und der Län-der, Karlsruhe. Current contributions, including employer’s contributions to the statutory pension insurance, are stated as personnel expenses. In the reporting year, contributions to defi ned contribu-tion pension plans totaled €2,285 thousand (pre-vious year: €1,492 thousand).

The defi ned benefi t plans in Germany are partly civil service-like overall provision systems toward which statutory pension insurance counts. The overall provision systems were closed for new employees in 1986. The systems were amended between 2000 and 2004 for employees who still qualifi ed for the overall provision system.

Pension commitments relating to employees who have joined the Group since 1986 are based on the so-called split pension formula. The pension en-titlement is based on qualifying length of service and qualifying income, with different percentages applying above and below the earnings ceiling. This pension plan was closed for new employees between 1993 and 1998 and amended for existing employees between 2000 and 2004.

Since January 1, 2007, there has been a defined contribution plan for new employees and for employees with no previous occupational pen-sion entitlement.

With the exception of some reinsurance cover and €18.8 million (previous year: €17.1 million) in assigned reinsurance policies, there are no assets that fulfi ll the requirements of plan assets as defi ned in IAS 9.7. However, reinsurance policies according to IFRS reimbursement rights by the terms of IAS 19.104A et seq. have been taken out for the majority of direct pension commitments.

A 0.5% increase or decrease in the discount rate would lead to a reduction or increase in pension commitments by €37.3 million (previous year: €28.0 million) or €39.2 million (previous year: €29.6 million), respectively. Differences between the assumed salary and pension trend and actual wage tariff increases and deviations between anticipated and actual income from plan assets in the year in question also have an effect, but to a much lesser extent. Defined benefit pension plan expenses break down as follows:

124


2011 2012

In ‘000 € Germany Abroad Total Germany Abroad Total

Current service cost 5,255 1,142 6,397 5,429 1,266 6,695

Interest expense 27,991 74 28,065 27,271 307 27,578

Anticipated income from plan assets 749 23 772 691 26 717

Anticipated income from reimbursements 12,059 0 12,059 12,238 0 12,238

Amortization of retroactive service cost 0 2 2 0 2 2

Plan reduction/settlement 0 –25 –25 0 –158 –158

Net pension expense 20,438 1,170 21,608 19,771 1,547 21,318

The amounts that must be stated in the balance sheet are as follows:

2011-12-31 2012-12-31


Pension commitments not financed via a fund 527,806 2,792 530,598 641,633 8,978 650,611

Pension commitments financed via a fund 33,429 8,900 42,329 17,293 7,193 24,486

Pension commitments 561,235 11,692 572,927 658,926 16,171 675,097

Plan assets –15,744 –1,308 –17,052 –17,130 –1,659 –18,789

Retroactive service cost 0 –10 –10 0 –6 –6

Pension commitments stated in the balance sheet 545,491 10,374 555,865 641,796 14,506 656,302

In assessing the defi ned benefi t obligation, vari-ables that determine the actual cost of payments made after retirement are taken into account. In addition to the biometric parameters used – the 2005 G Klaus Heubeck tables (with statements on mortality, survivors, and disability) – these are mainly financial assumptions in respect of, for example, the discount rate and future salary and payment levels.

The main assumptions are as follows:

2011 2012

Germany Abroad Germany Abroad

Actuarial interest rate 5.00 % 1.86 % 3.50 % 2.09 %

Wage and salary trend 2.25 % 3.87 % 2.25 % 3.88 %

Increase in current payments 2.00 % – 2.00 % –

Yield of plan assets in following year 4.79 % 2.00 % n.a.* n.a.*

Yield of reimbursements in following year 4.76 % – n.a.* –

* From the reporting year 2013, interest income will be determined on the basis of the actuarial interest rate.

125


Financial Report




Taking the respective calculation basis into ac-count, the position as regards the main provision- and fund-financed pension commitments is as follows:

2011 2012


Defined benefit obligation as at 01-01 548,160 10,061 558,221 561,235 11,692 572,927

Addition to plan assets 0 0 0 0 0 0

Current service cost 5,255 1,142 6,397 5,429 1,266 6,695

Interest expense 27,991 74 28,065 27,271 307 27,578

Actual payments –37,456 –406 –37,862 –38,469 –428 –38,897

Transfer 0 172 172 –97 68 1,043

Company purchase/sale –262 0 –262 0 0 0

Plan reduction/settlement 0 –25 –25 0 –159 –159

Salary conversion 577 0 577 597 0 597

Exchange rate effects 0 405 405 0 –233 –233

Actuarial profit/loss 16,970 269 17,239 102,960 3,658 105,546

Defined benefit obligation as at 12-31 561,235 11,692 572,927 658,926 16,171 675,097

Plan assets as at 01-01 15,615 1,199 16,814 15,744 1,308 17,052

Transfer 0 0 0 –164 0 1,066


Plan reduction/settlement 0 0 0 0 0 0

Contributions to plan assets 577 89 666 597 307 904

Anticipated income 749 22 771 691 26 717

Payments –34 0 –34 –4 0 –4

Exchange rate effects 0 –3 –3 0 30 30

Actuarial profit/loss –958 1 –957 266 –12 –976

Plan assets as at 12-31 15,744 1,308 17,052 17,130 1,659 18,789

Present value of reimbursements as at 01-01 254,386 0 254,386 258,655 0 258,655

Contributions 5,336 0 5,336 5,105 0 5,105

Reimbursements –12,069 0 –12,069 –12,476 0 –12,476

Transfer 0 0 0 166 0 166


Anticipated income 12,059 0 12,059 12,238 0 12,238

Actuarial profit/loss –1,000 0 –1,000 805 0 805

Present value of reimbursements as at 12-31 258,655 0 258,655 264,493 0 264,493

At the end of the reporting period on Decem-ber 31, 2012, equity capital included actuarial losses totaling €115,314 thousand (previous year: profi ts of €13,416 thousand). These are primar-ily due to the interest rate-related increase of the defi ned benefi t pension commitment.

The assets of the present value of reimbursements and plan assets include reinsurance policies with Alters- und Hinterbliebenen-Versicherung der

Technischen Überwachungs-Vereine-VVaG, Essen; ERGO Lebensversicherung AG, Düsseldorf; and DBV Deutsche Beamtenversicherung Leb-ensversicherung AG, Wiesbaden. In Germany, the fair value of plan assets and part of the reim-bursements as per IAS 19.104 or IAS 19.104D is determined in accordance with the defi ned ben-efi t obligation amount. Anticipated income from reimbursements and plan assets is based on aver-age yields.

126


Actual income from reimbursement claims totaled €13.0 million (previous year: €11.1 million), and actual income from plan assets was €–273 thou-sand (previous year: €–209 thousand).

For the reporting year 2013, reinsurance premi-ums are expected to amount to €5.8 million (pre-vious year: €9.5 million).

IAS 19.120A (p) requires a fi ve-year history of de-fi ned benefi t obligations to be stated from Janu-ary 1, 2007:

In ‘000 €

As at

2007-12-31

As at

2008-12-31

As at

2009-12-31

As at

2010-12-31

As at

2011-12-31

As at 2012-12-31

Defined benefit pension plans

Defined benefit obligation 538,700 533,346 558,177 558,221 572,927 675,097

Plan assets 2,375 2,062 2,647 16,814 17,052 18,789

Funding status 536,325 531,284 555,530 541,407 555,875 656,308

Experience adjustments

of the defined benefit obligation 4,776 –431 5,868 1,235 2,973 1,332

of the plan assets 34 0 239 –104 1,065 –462

(33) Other Provisions

As at 2011-12-31 As at 2012-12-31

In ‘000 € Total

of which

current Totalof which

current

Personnel provisions 57,459 45,504 60,047 47,106

Miscellaneous provisions 20,798 19,274 27,419 25,412

Total 78,257 64,778 87,466 72,518

Personnel provisions mainly involve variable remuneration of employees and management, including applicable social security contributions, obligations arising from partial retirement agree-ments, benefi ts, and anniversary payments. Non-current provisions will also be utilized within the next fi ve years for the most part.

Provisions developed as follows in the reporting year:

In ‘000 €

Opening balance Addition Use Reversal

Other

changes*

Closing balance

Personnel provisions 57,459 41,695 33,265 4,716 –1,126 60,047

Miscellaneous provisions 20,798 20,841 11,297 4,279 1,356 27,419

Total 78,257 62,536 44,562 8,995 230 87,466

* Change in basis for consolidation, exchange rate, and account balancing with actuarial reserves.

127


Financial Report




The future obligations listed are for the most part rent for business premises. Leasing expenses in the reporting year totaled €68,862 (previous year: €65,244) and consisted mainly of rent for business premises in connection with operating leases.

OTHER DISCLOSURES

(37) Additional Disclosures on

Financial Instruments

Based on the balance sheet items, the following tables present the measurement of fi nancial in-strument categories pursuant to IFRS 7 for the reporting year and the comparison year:

In the reporting year, as in the previous year, there was no material accrued interest on non-current provisions.

(34) Liabilities

Non-current Current Total

In ‘000 €

As at

2011-12-31

As at 2012-12-31

As at

2011-12-31

As at 2012-12-31

As at

2011-12-31

As at 2012-12-31

Income tax liabilities 0 0 24,990 26,480 24,990 26,480

Trade liabilities 0 0 70,068 74,321 70,068 74,321

Advance payments for orders 8 0 22,355 34,993 22,363 34,993

Trade liabilities 8 0 92,423 109,314 92,431 109,314

Liabilities due to banks 93,435 102,826 38,250 25,759 131,685 128,585

Liabilities due to affiliated

companies 0 0 656 686 656 686

Liabilities to associates 0 0 514 329 514 329

Other tax liabilities 141 362 34,920 36,137 35,061 36,499

Social security liabilities 2,411 1,693 17,366 21,129 19,777 22,822

Miscellaneous liabilities 11,368 14,232 59,106 60,457 70,474 74,689

Other liabilities 107,355 119,113 150,812 144,497 258,167 263,610

Total 107,363 119,113 268,225 280,291 375,588 399,404

(35) Legal Proceedings

TÜV Rheinland AG and its subsidiaries are not involved in legal proceedings that could have a material effect on the Group’s economic or financial position. Appropriate provision has been made for charges arising from other legal proceedings. (36) Other Financial Obligations

The following minimum lease payments will fall due in the future in relation to existing rental, least, and leasing agreements:

In ‘000 €

As at

2011-12-31

As at2012-12-31

Future rental, lease, and leas-ing agreement obligations

Due within a year 55,806 49,329

Due within 1–5 years 86,695 85,696

Due in over 5 years 48,615 41,315

Total 191,116 176,340

128


In ‘000 €

Carrying amount

as at 2012-12-31

Financial assets/

liabilities at fair

value through profit

or loss

Available-for-sale

financial assets

stated at fair value

with no effect on

incom

Financial assets/

liabilities valued at

amortized cost

No

IAS 39 valuation

category

Assets

Non-current assets

Other financial assets 267,976

Securities 201 201

Investments 3,037 2,463 574

Financial instruments unre-

lated to the remit of IFRS 7 264,738 264,738

Other non-current assets 11,014

Other assets 10,919 10,919

Financial derivatives 95 95

Current assets


Other receivables and other cur-

rent assets 85,526

Other receivables 48,757 30 48,727

Financial derivatives

Non-financial assets 36,769 36,769

Cash and cash equivalents 88,369 88,369


Non-current liabilities

Non-current liabilities 119,113

Liabilities due to banks 102,826 102,826

Trade liabilities

Miscellaneous liabilities 13,247 12,549 698


Non-financial liabilities 2,054 2,054

Current liabilities

Trade liabilities 109,314 74,321 34,993

Other current liabilities 144,497


Miscellaneous liabilities 733 686 47



Sum total by IAS 39 valuation category

95/0 231

0/216,141

129


Financial Report




Other Disclosures

In ‘000 €

Carrying amount

as at 2011-12-31

Financial assets/

liabilities at fair

value through profit

or loss

Available-for-sale

financial assets

stated at fair value

with no effect on

income

Financial assets/

liabilities valued at

amortized cost

No

IAS 39 valuation

category

Assets

Non-current assets

Other financial assets 265,540

Securities 4,438 4,438

Investments 2,350 1,973 377

Financial instruments unrelated

to the remit of IFRS 7 258,752 258,752

Other non-current assets 12,151

Other assets 12,034 12,034


Current assets


Other receivables and other

current assets 84,367

Other receivables 54,638 30 54,608


Non-financial assets 29,585 29,585

Cash and cash equivalents 93,157 93,157


Non-current liabilities

Non-current liabilities 107,363


Trade liabilities 8 8

Miscellaneous liabilities 10,602 10,133 469



Current liabilities

Trade liabilities 92,423 70,068 22,355

Other current liabilities 150,812


Miscellaneous liabilities 811 656 155



Sum total by IAS 39 valuation category

261/0 4,468

387,906/212,542

130


The measurement of fi nancial assets and liabili-ties is undertaken in accordance with the avail-ability of relevant information on the basis of the three-stage fair valuation hierarchy speci-fi ed in IFRS 7. In the fi rst stage, the listed market prices for identical assets and liabilities in active markets are directly observable. In the second stage, the valuation is based on techniques into which parameters observable in the market fl ow. The third stage provides for the use of valuation techniques that fall back on input factors not observable in the market. All derivative finan-cial assets and liabilities come under the second stage. Securities can also be allocated to this stage.

The fair value of liabilities due to banks was €656 thousand above the carrying amount in the reporting year (previous year: €3,037 thou-sand). For current loans and receivables and fi nancial liabilities at amortized cost of acquisi-tion, the carrying amount is assumed to be close to the fair value.

The net gain/loss by valuation category is as follows:

In ‘000 € 2011 2012

Financial assets/liabilities at fair

value through profit or loss 261 –166

Loans and receivables 162 –1,019

Available-for-sale financial assets 60 121

Financial liabilities valued at amor-

tized cost –9,699 –7,467

Total –9,216 –8,531

Changes in the market value of derivatives are recorded under financial assets and liabilities stated at fair value through profi t or loss. They are stated under other financial result. Loans and receivables contain allowances on receiv-ables and interest on receivables and loans granted. Allowances on receivables are stated under other operating income or other oper-ating expenses. In contrast, interest from re-ceivables and loans granted is stated as interest

income. Available-for-sale financial assets in-clude allowances on securities that are shown under other financial result. Interest on loans received is recorded under fi nancial assets at am-ortized cost and is stated as interest income.

(38) Financial Risks

The TÜV Rheinland Group is exposed to fi nan-cial risks in the form of credit risks, liquidity risks, and market risks. Due to the integration of risk management into the TÜV Rheinland Group’s management information system, risk is controlled by appropriate evaluation on a universal basis in all companies as well as on the Group level. The Executive Board has set up a risk management unit and instructed it to carry out an analysis and assessment of individual risk and opportunity reports. Comprehensive, early, and systematic countermeasures are undertaken to minimize risks and strengthen opportunities.

Credit risks exist in operational business, in available-for-sale fi nancial assets, and in fi nan-cial derivatives. For service transactions in op-erational business, securities are agreed, credit information is secured, or use is made of historic data from previous business relations, especially about payment behavior, to avoid credit risks subject to the nature and amount of the ser-vice in question. Identifiable risks are covered by appropriate valuation allowances that are oriented to actual references in the individual instance or the maturity structure and to actual bad debt losses in the past.

The maximum credit risk for trade receivables, receivables based on percentage of completion, and loans is their carrying amount as at Decem-ber 31, 2012. Trade receivables that are past due are listed in Note (28).

The maximum credit risk for available-for-sale fi nancial assets and fi nancial derivatives is equivalent to their market values as at Decem-ber 31, 2012.

131


Financial Report



Other Disclosures

Financial derivatives are only concluded with counterparties that have a high rating and with whom a default on the contractual obligation is not to be expected.

The fundamental market risks for fi nancial in-struments are currency and interest rate risks.

Financial derivatives may only be concluded in connection with a hedged item. To limit risks, subsidiaries are not allowed to purchase securities.

The TÜV Rheinland Group uses derivatives to hedge the risk of interest rate changes and cur-rency risks. For interest hedging, the TÜV Rhein-land Group also applies the provisions of IAS 39 on cash fl ow hedge accounting. In the process, the variable interest cash fl ows of different loans are protected from variable reference interest rate fl uctuations. To ensure that the aim of risk management is fulfilled, the TÜV Rheinland Group documents the effectiveness of hedges at the time of designation (prospective effective-ness) and at the end of every reporting period (retrospective effectiveness).

In relation to a nominal amount of €1,146 thou-sand, a loan is hedged against fluctuations in the three-month Euribor reference interest rate. The hedge instrument is an interest rate swap with a nominal amount of €1,146 thousand as at the end of the reporting period and con-tracted to run until August 29, 2014, which cor-responds to the hedged item in its fundamental terms and conditions – above all, the nominal amount, the variable market interest rate, inter-est rate adjustment, and interest due dates. The interest rate swap is stated as at the end of the reporting period at a fair value (»dirty price«) of €–34 thousand (previous year: €–64 thousand). The interest payments hedged are due quarterly and have a chronologically corresponding effect on the TÜV Rheinland Group’s profi t and losses. In the reporting year, a sum after deferred taxes of €20 thousand (previous year: €25 thousand) was recorded in the consolidated statement of comprehensive income. No ineffective sums were shown in the income statement.

Moreover, a loan with a nominal amount of €15,000 thousand is hedged against changes in the three-month Euribor reference interest rate by means of an interest rate swap with the same nominal value. The hedge instrument runs until September 30, 2015, and corresponds to the hedged item in its fundamental terms and conditions – above all, the nominal amount, the variable market interest rate, interest rate adjustment, and interest due dates. The inter-est rate swap is stated as at the end of the report-ing period at a fair value (»dirty price«) of €–316 thousand (previous year: €–185 thousand). The interest payments hedged are due quarterly and have a chronologically corresponding effect on the TÜV Rheinland Group’s profits and losses. In the reporting year, a sum after deferred taxes of €69 thousand (previous year: €201 thousand) was recorded in the consolidated statement of comprehensive income. Additionally, a cost of €30 was shown in the income statement due to the ineffectiveness of the hedge accounting.

The TÜV Rheinland Group has also hedged a loan with a nominal amount of €10,000 thou-sand against fluctuations in the three-month Euribor reference interest rate. The hedge in-strument is an interest rate swap with an iden-tical nominal amount that is contracted to run until September 30, 2016, which corresponds to the hedged item in its fundamental terms and conditions – above all, the nominal amount, the variable market interest rate, interest rate adjustment, and interest due dates. The interest rate swap is stated as at the end of the report-ing period at a fair value (»dirty price«) of €–338 thousand (previous year: €–156 thousand). The interest payments hedged are due quarterly and have a chronologically corresponding effect on the TÜV Group’s profit and losses. In the re-porting year, a sum after deferred taxes of €124 thousand (previous year: €107 thousand) was recorded in the consolidated statement of com-prehensive income. No ineffective sums were shown in the income statement.

132


The TÜV Rheinland Group has also hedged a loan with a nominal amount of €2,788 thou-sand against fluctuations in the three-month Libor reference interest rate. The hedge instru-ment is an interest rate swap with a nominal amount of €2,788 thousand that corresponds to the hedged item in its fundamental terms and conditions and runs until August 30, 2016. The interest rates are settled quarterly and have a chronologically corresponding effect on the income statement. The fair value of the interest rate swap as at the end of the reporting period is €–204 thousand (previous year: €–276 thou-sand). In the reporting year, a sum after deferred taxes of €50 thousand (previous year: €0) was recorded in the consolidated statement of com-prehensive income. No ineffective sums are due.

The TÜV Rheinland Group has also hedged one loan with a nominal value of TCLP (thousand Chilean pesos) 453,000 with a foreign exchange transaction against the risk of exchange rate fl uctuations. The foreign exchange transaction reports an identical nominal amount and runs until October 21, 2013, and is stated as at the end of the reporting period with a fair value of €–125 thousand (previous year: €–79 thousand). In the reporting year, a sum after deferred taxes of €32 thousand (previous year: €20 thousand) was recorded in the consolidated statement of com-prehensive income. No ineffective sums were shown in the income statement.

Furthermore, a loan with a nominal amount of €15,000 thousand is hedged against changes in the six-month Euribor reference interest rate. An interest rate swap with a nominal amount of €15,000 thousand as at the end of the report-ing period functions as a hedge instrument. The hedge instrument runs until August 18, 2017, and corresponds to the hedged item in its fun-damental terms and conditions – above all, the nominal amount, the variable market inter-est rate, interest rate adjustment, and interest due dates. The interest rate swap is stated as at the end of the reporting period at a fair value (»dirty price«) of €–93 thousand. The interest payments hedged are due quarterly and have

a chronologically corresponding effect on the TÜV Rheinland Group’s profits and losses. In the reporting year, a sum after deferred taxes of €64 thousand was recorded in the consolidated statement of comprehensive income No ineffec-tive sums were stated in the income statement.

Furthermore, in connection with hedge ac-counting, a loan with a nominal amount of TAUD (thousand Australian dollars) 600 is hedged with a foreign exchange transaction against the risk of exchange rate fluctuations. The foreign exchange transaction reports an identical nominal amount and runs until March 28, 2013. The foreign exchange transaction is stated as at the end of the reporting period with a fair value of €14 thousand. In the reporting year, a sum after deferred taxes of €9 thousand was recorded in the consolidated statement of comprehensive income. No ineffective sums were shown in the income statement.

The market value of these interest rate swaps would change by €407,000 (€–888,000) in the event of a shift in the yield curve of +100 (–100) basis points. Interest rate risks also exist for fi xed income securities. A 1% increase in the inter-est rate would not, however, lead to a material change in market value. The action framework for currency management is laid down in internal guidelines. Currency risks do not, for the most part, exist within the TÜV Rheinland Group because individual Group companies largely conduct their opera-tional activities in their respective functional currencies. Currency risks run in operational business may be hedged by the use of fi nancial derivatives. Currency risks as at the end of the reporting period were investigated by means of sensitivity analyses. In trade receivables and lia-bilities, a revaluation of the euro by 10% against all currencies as at the end of the reporting pe-riod would have only a minor effect on the re-sult for the year and on equity capital. As at the end of the reporting period, the TÜV Rheinland Group held no signifi cant currency derivatives.

133


Financial Report



Other Disclosures

To manage liquidity risks within the TÜV Rhein-land Group, there is always an up-to-date liquid-ity plan and a suffi cient liquidity reserve in the form of cash and lines of credit. Bank deposits are held only at banks with a high credit rating.

(40) Related Party Disclosures

The related parties of the TÜV Rheinland Group are TÜV Rheinland Berlin Brandenburg Pfalz e. V. (TÜV Rheinland AG’s sole shareholder) and all of the companies that are not fully consoli-dated in the Group’s fi nancial statements. Indi-vidual related parties are members of the Execu-tive Board and Supervisory Board, Executive Vice Presidents, Heads of German Operations and in-ternational Chief Regional Offi cers. In 2012, TÜV Rheinland Group companies main-tained the following business relationships with TÜV Rheinland Berlin Brandenburg Pfalz e. V.:

In ‘000 € 2011 2012

Services provided to the e. V. 11,757 11,843

Services received from the e. V. 14,262 14,379

Receivables as at 12-31 48,262 42,144

Liabilities as at 12-31 437 0

Risks are minimized for current securities by di-versifi cation of the issuers. As at December 31, 2012, the maturity structure of expected undis-counted cash flow (interest and repayment of principal) was as follows:

In ‘000 €

Liabilities due

to banks*- Trade liabilities Total

Due within a year 43,181 74,321 117,502

Due in 2nd year 27,930 27,930

Due in 3rd year 26,419 26,419

Due in 4th year 11,932 11,932

Due in 5th to 10th years 18,784 18,784

Due after 10th year 8,472 8,472

* Including payments from derivative financial instruments (interest rate swaps).

The amount of €43,181 thousand due to banks (and due within a year) includes lines of credit for unlimited periods and therefore with signifi -cantly longer due dates.

(39) Cash Flow Statement Disclosures

Cash and cash equivalents in the cash fl ow state-ment comprise all cash and cash equivalents stated in the balance sheet (i.e. cash on hand, checks, and credit balances with banks) that are available within three months. There are no restrictions on the disposal of cash and cash equivalents.

The cash fl ow from operating activities includes the following payments:

In ‘000 € 2011 2012

Interest paid 9,974 7,855

Interest received 4,664 3,756

Income tax paid 48,391 40,993

Income tax received 10,604 12,463

Dividends received 160 407

134


Services received are mainly tenancies and gen-eral and financial services. Transactions are charged at market rates.

Service relations between the TÜV Rheinland Group and other related parties are of minor importance.

Supervisory Board Remuneration

The members of the Supervisory Board were paid a total of €930 thousand in remunera-tion in the reporting year (previous year: €921 thousand).

No loans were made to Supervisory Board mem-bers in the reporting year.

(41) Events After the Reporting Period

The TÜV Rheinland AG Executive Board pro-poses to the Annual Shareholder’s Meeting that a dividend of €16.5 million be paid to the sole shareholder, TÜV Rheinland Berlin Brandenburg Pfalz e. V., from the 2012 balance sheet profi t of €52,655,353.97, and that € 20 million be allo-cated to retained earnings, with the remaining €16,155,353.97 being carried forward to new account.

(42) Auditor’s Fees and Services in Accor-

dance with Section 314 HGB

The fees stated for the audit of the consolidated annual financial statements in the reporting year break down as follows:

Group auditors Other Total

In ‘000 € 2011 2012 2011 2012 2011 2012

Fees for audit of annual financial statements 1,163 1,251 243 275 1,406 1,526

Fees for other audit services 94 19 10 3 104 22

Fees for tax consultancy services 201 134 29 50 230 184

Fees for other services 439 107 0 0 439 107

Total 1,897 1,511 282 328 2,179 1,839

135


Financial Report



Other Disclosures

(43) Companies Included

Fully Consolidated Companies in Germany

Company name

Company

domicile

Capital

stock-

in %2

AMD TÜV Arbeitsmedizinische

Dienste GmbH TÜV Rheinland

Group1 Berlin 100

The Campus GmbH Center of

Competence Düsseldorf 100

DIN CERTCO Gesellschaft für

Konformitätsbewertung mbH Berlin 80,2

DIN GOST TÜV Berlin-

Brandenburg Gesellschaft für

Zertifizierung in Europa mbH Berlin 51

FSP-Fahrzeug-Sicherheitsprü-

fung Leitung und Service GmbH3 Geltow 47

FSP-Schaden- und

Wertgut achterdienst Gm bH3 Geltow 47

Gemeinnützige Gesellschaft

TÜV Rheinland Bildungswerk

mbH Berlin 100

InFES GmbH Resources and

Services Düsseldorf 100

LCH Eurocontrol GmbH Hamburg 56

LGA InterCert Zertifizierungs-

gesellschaft GmbH1 Nuremberg 100

Luxcontrol GmbH Hamburg 56

move GmbH – Unternehmens-

gruppe TÜV Rheinland Düsseldorf 100

TÜV Fahrzeug-Lichttechnik

GmbH TÜV Rheinland Group1 Berlin 100

TÜV Immobiliengesellschaft

Berlin GmbH Cologne 83,94

TÜV International GmbH –

Unternehmensgruppe TÜV

Rheinland1 Cologne 100

TÜV Media GmbH1Cologne 100

TÜV Pfalz Anlagen und Betriebs-

technik GmbH1

Kaisers-

lautern 94

TÜV Pfalz GmbH1

Kaisers-

lautern 94

TÜV Pfalz Verkehrswesen

GmbH1

Kaisers-

lautern 94

TÜV Rheinland Agroisolab

GmbH Jülich 76,7

TÜV Rheinland Akademie GmbH1 Berlin 100

TÜV Rheinland Cert GmbH1 Cologne 100

TÜV Rheinland Consulting

GmbH1 Cologne 100

TÜV Rheinland Energie

und Umwelt GmbH1 Cologne 100

Fully Consolidated Companies in Germany

Company name

Company

domicile

Capital

stock-

in %2

TÜV Rheinland Fahrzeug-

überwachung GmbH

Brandenburg/Berlin1 Potsdam 94

TÜV Rheinland Grebner Ruchay

Consulting GmbH Frankfurt 81,35

TÜV Rheinland Grundstücks-

gesellschaft mbH & Co. KG Grünwald 100

TÜV Rheinland Grundstücksge-

sellschaft Nürnberg mbH & Co.

KG Grünwald 94,9

TÜV Rheinland Immobilien-

gesellschaft mbH & Co KG1 Cologne 88,36

TÜV Rheinland Industrie Service

GmbH1 Cologne 100

TÜV Rheinland Insitu Calibration

GmbH Cologne 100

TÜV Rheinland InterTraffic

GmbH Cologne 94

TÜV Rheinland i-sec GmbH1 Cologne 100

TÜV Rheinland Kraftfahrt GmbH1 Cologne 94

TÜV Rheinland Leben und Ge-

sundheit GmbH1 Cologne 100

TÜV Rheinland LGA Bautechnik

GmbH1 Cologne 100

TÜV Rheinland LGA

Beteiligungs GmbH1 Cologne 100

TÜV Rheinland LGA Products

GmbH1 Cologne 100

TÜV Rheinland Pension Fund

GmbH1 Cologne 94

TÜV Rheinland Personal GmbH Cologne 100

TÜV Rheinland Plus GmbH3 Cologne 47,94

TÜV Rheinland Schaden- und

Wertgutachten GmbH1 Cologne 94

TÜV Rheinland Schniering GmbH1 Essen 100

TÜV Rheinland Service GmbH1 Cologne 100

TÜV Rheinland Sonovation

GmbH Böhlen 100

TÜV Rheinland Systeme GmbH1 Cologne 100

TÜV Rheinland Werkstoff-

prüfung GmbH1 Peitz 100

TÜV Saarland Automobil GmbH Sulzbach 70,41

TÜV Saarland Kfz-team GmbH Saarbrücken 55,62

TÜV Umwelt Berlin-

Brandenburg GmbH Berlin 100

VTÜ Versicherungsvermittlung

GmbH1 Cologne 100

136


Fully Consolidated Companies in Other Countries

Company name

Company

domicile

Capital

stock-

in %2

AUTESTS SIA Riga 80

Benelux NDT & Inspection

Supplies B.V. Oosterhout 100

DUCTOR Implantacao de

PROJETOS Ltda. São Paulo 100

GERIS Engenharia e Serviços

Ltda. São Paulo 100

ICICT Serveis S.L. Sabadell 100

ITACS Pty. Ltd. Adelaide 100

LRTDEA – TÜV Rheinland Grupa,

SIA Riga 83,3

LUXCONTROL S.A. Esch/Alzette 56

Ogres Servisa Centrs Riga 100

PT TUV Rheinland Indonesia Jakarta 90

SECTA S.A. Courbevoie 50,51

TÜV Akademia Polska Sp. z o.o.

Unternehmensgruppe

TÜV Rhld./BB Zabrze 100

TUV DCTA SAS Montrouge 100

TUV FRANCE SAS-GROUPE

TUV RHEINLAND Montrouge 100

TÜV International RUS OOO Moscow 100

TÜV International s.r.o. Prague 100

TUV Rheinland AIA Services,

LLC Houston 80,17

TUV Rheinland AIMEX Ltd. Taipei 100

TÜV Rheinland Andino S.A.

Santiago de

Chile 100

TÜV Rheinland Arabia LLC Jidda 60

TÜV RHEINLAND ARGENTINA

S.A.

Buenos

Aires 100

TUV Rheinland Australia Pty. Ltd.

South

Melbourne 100

TÜV Rheinland Bangladesh Pvt.

Ltd. Dhaka 100

TÜV Rheinland Belgium NV Antwerp 90

TÜV Rheinland Bulgaria EOOD Sofia 100

TÜV Rheinland Canada Inc. Toronto 100

TÜV Rheinland CHILE S.A.

Santiago de

Chile 100

TÜV RHEINLAND (China) Ltd. Beijing 100

TÜV RHEINLAND COLOMBIA

S.A.S. Bogotá 100

TUV RHEINLAND DE MEXICO

S.A. DE C.V. Mexico City 100


Company name

Company

domicile

Capital

stock-

in %2

TÜV Rheinland do Brasil Holding

Ltda. São Paulo 100

TÜV Rheinland do Brasil Ltda. São Paulo 100

TÜV Rheinland Egypt Ltd. Cairo 99

TÜV RHEINLAND FRANCE SAS Montrouge 100

TÜV Rheinland (Guangdong)

Ltd. Guangzhou 100

TUV RHEINLAND HONG KONG

LIMITED Hong Kong 100

TÜV Rheinland Ibérica Holding,

S.L. Madrid 100

TÜV Rheinland Ibérica Inspec-

tion, Certification & Testing S.A. Barcelona 100

TÜV Rheinland IBÉRICA, S.A. Madrid 100

TUV Rheinland Immo SAS Montrouge 100

TUV Rheinland (India) Private

Ltd. Bangalore 100

TUV Rheinland Industrial

Solutions, Inc. Caledonia 100

TÜV Rheinland Inspection

Services (Pty.) Ltd. Pretoria 74

TÜV Rheinland InterCert d.o.o. Belgrade 100

TÜV Rheinland InterCert Kft. Budapest 100

ÜV Rheinland Italia S.r.l.

Pogliano

Milanese 100

TUV Rheinland Japan Ltd. Yokohama 100

TÜV Rheinland Korea Ltd. Seoul 100

TÜV Rheinland Luxemburg

GmbH Luxemburg 100

TUV Rheinland Malaysia SDN

BHD

Subang

Jaya 100

TUV Rheinland Middle East –

L.L.C. Abu Dhabi 100

TUV Rheinland Middle East FZE Dubai 100

TÜV Rheinland NAVARRA SA Pamplona 100

TÜV Rheinland Nederland B.V. Amsterdam 100

TUV Rheinland North America

Holding, Inc. Boston 100

TUV Rheinland of North

America, Inc. Newtown 100

TÜV Rheinland Peru S.A.C. Lima 100

TÜV Rheinland Philippines, Inc. Manila 100

TÜV Rheinland Polska Sp. z o.o. Warsaw 100

TÜV Rheinland Portugal

Inspeccoes Tecnicas, Lda. Algés 100

1 Recourse is made to Section 264 (3) HGB for this company.2 The share of the voting rights corresponds to the stated capital stock.3 Fully consolidated by virtue of corporate body rights.

137


Financial Report



Other Disclosures

Joint Ventures Included

Company name

Company

domicile

Capital

stock-

in %2

Auteko & Latvija GmbH Riga 49

TÜV Rheinland TNO

Automotive International B.V. Helmond 47

Associates Included

Company name

Company

domicile

Capital

stock-

in %2

CDN Serviços de Água e Esgoto

S.A.

Rio de

Janeiro 32,5

Non-Consolidated Companies in Germany

Company name

Company

domicile

Capital

stock-

in %2

autocon GmbH Düsseldorf 100

BNDT Prüftechnik GmbH Böhlen 100

Deutsche TÜV GmbH – Unter-

nehmensgruppe TÜV Rhld./BB Cologne 100

Deutsche TÜV GmbH Mitte Cologne 100

FMG Fuhrparkmanagement

GmbH Tübingen 100

TRB GmbH Cologne 88,36

TÜV 1 GmbH – Unternehmens-

gruppe TÜV Rhld./BB Cologne 100

TÜV Alliance GmbH Cologne 100

TÜV Rheinland AUTO

EUROSERVICE GmbH Cologne 94

TÜV Rheinland STEP

International GmbH Cologne 94

TÜV Berlin Brandenburg

Gesellschaft von KFZ-Sach-

verständigen mbh Cottbus 100

TÜV Berlin Brandenburg

Verwaltungs-GmbH Berlin 95

TÜV Berlin GmbH Berlin 100

TÜV Ostdeutschland Sicherheit

und Umweltschutz GmbH Halle 100

TÜV Union Deutschland GmbH Cologne 100

TÜV WEST AG Cologne 50

www.tuv.com GmbH

TÜV Rheinland Group Cologne 100


Company name

Company

domicile

Capital

stock-

in %2

TUV Rheinland PTL LLC Tempe 85,26

TÜV Rheinland Quality Control

(Pty.) Ltd.3 Pretoria 49

TÜV Rheinland Quality Services

(Pty.) Ltd. Pretoria 100

TUV Rheinland Rail Sciences,

Inc. Scottdale 100

TÜV Rheinland Romania S.R.L. Bucharest 100

TUV Rheinland (Shanghai) Co.,

Ltd. Shanghai 100

TÜV Rheinland (Shenzhen) Co.,

Ltd. Shenzhen 100

TÜV RHEINLAND SINGAPORE

PTE. LTD. Singapore 100

TÜV Rheinland Slovensko s.r.o. Bratislava 100

TÜV Rheinland Sonovation B.V. Oosterhout 100


Holding B.V. Oosterhout 100

TÜV RHEINLAND TAIWAN LTD. Taipei 100

TUV Rheinland Thailand Ltd. Bangkok 100

TÜV Rheinland Türkiye A. S. Istanbul 100

TUV Rheinland UK Ltd. Solihull 100

TÜV Rheinland Ukraine GmbH Kiev 100

TÜV Rheinland Vietnam Co. Ltd.

Ho Chi Minh

City 100

TUV RHEINLAND VISTORIAS

LTDA.

Santana de

Parnaiba 100

TÜV Rheinland (Wuxi)

Automotive Testing Co., Ltd. Shanghai 70

TÜV Rheinland/CCIC (Ningbo)

Co., Ltd.3 Ningbo 50

TÜV Rheinland/CCIC (Qingdao)

Co., Ltd. Qingdao 55

138


Non-Consolidated Companies in Other Countries

Company name

Company

domicile

Capital

stock-

in %2

LC LUXCONTROL asbl Esch/Alzette 56

Luxcontrol Nederland B.V. Utrecht 94

SEINCOSA S.L. Barcelona 100

TÜV Quality Control Ltd. Cairo 83

TÜV Rheinland Akademie Chile

Ltda.

Santiago de

Chile 100

TUV Rheinland/ANTAEAN Co.,

Ltd. Kunshan 50

TÜV RHEINLAND BELGIUM

A.S.B.L. Antwerp 100

TUV Rheinland Cambodia Co.,

Ltd.

Phnom

Penh 100

TUV Rheinland Kuwait WLL Kuwait 49

TUV Rheinland Mandy Ltd. Fuzhou 75

TÜV Rheinland Sonovation Ltd. Cheshire 100

TÜV Rheinland Sonovation NV Antwerp 100


Products & Systems B.V. Oosterhout 100

TUV Telecom Services, INC. Houston 100

TÜV ZSSM GmbH Moscow 65

1 Recourse is made to Section 264 (3) HGB for this company.2 The share of the voting rights corresponds to the stated capital stock.3 Fully consolidated by virtue of corporate body rights.

139


Financial Report



Other Disclosures

AUDIT OPINION

We have audited the consolidated financial statements – consisting of the balance sheet, income statement, statement of comprehensive income, statement of changes in equity, cash flow statement, and the notes – as well as the Group Management Report for the business year from January 1 to December 31, 2012, prepared by TÜV Rheinland Aktiengesellschaft, Cologne. Preparation of the consolidated fi nancial state-ments and Group management report according to IFRS as applicable in the EU and, additionally, to German commercial law regulations pursuant to Section 315a (1) of the German Commercial Code (HGB) is the responsibility of the compa-ny’s Executive Board. Our responsibility is to ex-press an opinion on the consolidated fi nancial statements and the Group management report based on the audit we have undertaken.

We conducted our audit of the consolidated fi -nancial statements in accordance with Section 317 of the German Commercial Code (HGB), taking into consideration the generally accepted accounting principles as set out by the German Institute of Public Auditors (IDW). These stan-dards require us to plan and perform audits in such a way that misstatements and violations materially affecting the presentation of assets, fi -nancial position, and profi tability results in the consolidated fi nancial statements in accordance with the applicable accounting rules and in the Group Management Report are detected with reasonable certainty. Knowledge of the Group’s business activities and of its economic and legal environment, and expectations of possible mis-statements are taken into account when deter-mining auditing procedures. The effectiveness of internal control mechanisms related to ac-counting and evidence supporting the disclo-sures in the consolidated financial statements and in the Group Management Report are as-sessed mainly by checking random samples. The audit includes the assessment of the annual fi -nancial statements of the companies included in the Group accounts, the delimitation of the Group companies being consolidated, the ac-counting and consolidation principles used, and

the signifi cant estimates made by the Executive Board, as well as the evaluation of the overall presentation of the consolidated fi nancial state-ments and the Group Management Report. We believe that our audit provides a reasonable basis for our opinion.

Our audit did not fi nd any irregularities with the exception of the following qualification: con-trary to IAS 24.17, as well as Section 315a (1) in conjunction with Section 314 (1) 6 (a) and (b) of the German Commercial Code (HGB), the emoluments of the management employees in key positions and the total earnings of the pres-ent and former members of the Executive Board were not stated in the notes.

In our opinion, based on what we learned from our audit, the consolidated financial state-ments comply with IFRS as applicable in the EU and with the German commercial law regula-tions additionally applicable pursuant to Sec-tion 315a (1) of the German Commercial Code (HGB). The consolidated financial statements give a true and fair view of the assets, fi nancial position, and profitability of the Group in ac-cordance with these regulations. The Group Management Report is consistent with the con-solidated financial statements conforming to the statutory regulations and overall provides an accurate and fair view of the fi nancial status of the Group and of the opportunities and risks attendant on its future development.

Cologne, March 18, 2013

PricewaterhouseCoopersAktiengesellschaftWirtschaftsprüfungsgesellschaft

Andreas MenkeAuditor

Thomas HusemeyerAuditor

AUDIT OPINION

140


SUPERVISORY BOARD

Shareholder representatives on the Supervisory BoardProf. Dr.-Ing. habil. Bruno O. Braun, Cologne, Chairman of the Supervisory Board CEO, TÜV Rheinland Berlin Brandenburg Pfalz e. V.

Dipl.-Wirtsch.-Ing. Heinz-Werner Binzel,Langenselbold, Managing Director, Energy & Water Consulting International GmbH

Dr. jur. Hermann H. Hollmann, Cologne, Board Member, Ford-Werke GmbH

Dipl.-Ing. Bodo F. Holz, Meerbusch, Advisory Council Chairman,Management Engineers GmbH & Co. KG

Dr.-Ing. Herbert Lütkestratkötter, Essen

Dr. jur. Gerd Schäfer, Tribsees/Landsdorf, AttorneyCMS Hasche Sigle

Employee representatives on the Supervisory BoardDipl.-Ing. Reiner Schon, Berlin, Acting ChairmanTÜV Rheinland Industrie Service GmbH

Andrea Becker, Essen, Regional Unit Offi cer for Special Services, ver.di North Rhine-West phalia (from March 29, 2012)

Rechtsanwalt Jan Bley, St. Augustin, TÜV Rheinland Aktiengesellschaft,Attorney

Angelika Hecker, Moers, Wage Scale Secretary, ver.di North Rhine-West phalia (until March 29, 2012)

Dipl.-Pädagoge Gerhard Meusel, Cologne, TÜV Rheinland Consulting GmbH

Dipl.-Ing. Johannes Scholz, Frechen, TÜV Rheinland Kraftfahrt GmbH

Dr. Wolfgang Uellenberg-van Dawen, Berlin, Divisional Director of Politics and Planning, Federal Administration ver.di

CORPORATE BODIES

EXECUTIVE BOARD



Ulrich FietzChief Financial Offi cer

Volker KlosowskiChief Technology Offi cer


Cologne, March 18, 2013

TÜV Rheinland Aktiengesellschaft

The Executive Board



Ulrich FietzChief Financial Offi cer

Volker KlosowskiChief Technology Offi cer


141


Service

Audit Opinion

Corporate Bodies

CERTIFICATION OF INDEPENDENT AUDIT

To TÜV Rheinland AG, Cologne

Based on a contractual agreement, we have conducted an audit to establish a limited assur-ance about the statements on corporate social responsibility (CSR) made by TÜV Rheinland AG, Cologne, in the chapter »Responsibility« on pages 42–71 of the printed version of its Corpo-rate Report for the business year 2012.

Responsibility of the Legal Representatives

TÜV Rheinland AG’s Executive Board is respon-sible for compiling the aforementioned chapter of CSR information in keeping with the criteria listed in the Sustainability Reporting Guidelines Vol. 3.0 (pages 7–17) of the Global Reporting Ini-tiative (GRI):

p Materiality, p Stakeholder inclusiveness, p Context of sustainability, p Completeness, p Balance, p Clarity, p Accuracy, p Timeliness, p Comparability, and p Reliability.

The responsibility consists of selecting and ap-plying appropriate methods of data collection used in drawing up the aforementioned chapter on sustainability on pages 42–71 and of con-fi rming that assumptions and estimates on in-dividual CSR statements are plausible under the circumstances. It also comprises the conception, implementation, and maintenance of systems and processes insofar as they are of importance for compiling the aforementioned chapter on sustainability.

Auditor’s Responsibility

Our task is to make an assessment on the basis of the work we have undertaken as to whether we have become aware of circumstances that lead us to assume that the statements on CSR for the 2012 business year made in the above-named chapter on sustainability on pages 42–71 of the Corporate Report for 2012 do not comply in ma-terial respects with the criteria of the GRI’s Sus-tainability Reporting Guidelines Vol. 3.0 (pages 7–17). In addition, we were instructed to make recommendations on the basis of our audit fi nd-ings on the further development of CSR man-agement and CSR reporting.

We conducted our audit with due regard for the International Standard on Assurance Engage-ments (ISAE) 3000, which requires us to abide by our professional duties and to plan and im-plement the commission with due regard for the principle of materiality so as to be able to make our assessment with a limited degree of certainty.

In an audit to establish “limited assurance,” the audit activities are less extensive than those un-dertaken in an audit to establish a suffi cient de-gree of certainty such as is required for annual fi nancial statements in accordance with Section 317 of the German Commercial Code (HGB), so that a correspondingly lower degree of certainty is achieved.

The choice of audit activities is subject to the auditor’s judgment. In the course of our audit, we undertook, among others, the following activities:

p An inspection of the documents on CSR strat-egy, CSR management, and stakeholder dia-logue along with obtaining an understand-ing of the topic-finding process for the CSR report;

VERIFICATION STATEMENT

142


p Interviews with employees at the Group’s headquarters in Cologne who are responsible for compiling the aforementioned chapters on CSR (the responsible areas include CSR and Sustainability, Human Resources, Oc-cupational Health and Safety, Environment, Global Process Management, Compliance, TÜV Rheinland Immobiliengesellschaft mbH & Co KG, and other various responsibilities in the area of training and further education) or for supplying details of the processes used to draw up CSR statements and consolidate data, and of the internal control system relat-ing to these processes; p An on-site visit to TÜV Rheinland Japan Ltd.

and the conduct of site-related interviews and surveys; p An inspection of the documentation of the

systems and processes used to record, ana-lyze, and aggregate statements on CSR and spot checks of the implementation; p An assessment of adherence to compliance

guidelines according to the Compliance Code of the International Federation of Inspection Agencies (IFIA) for selected subsidiaries of TÜV Rheinland; p An analytical assessment of CSR data; p Spot checks of the evidence provided in sup-

port of individual CSR details, including inspection of internal documents, exter-nal reports, and invoices as well as an un-derstanding of conversions, estimates, and projections.

Judgment

On the basis of our audit to establish a »limited assurance,« we have not become aware of any circumstances that lead us to believe that the statements on CSR for the 2012 business year made in the above-named chapter on sustain-ability on pages 42–71 of the Corporate Report for 2012 do not comply in material respects with the criteria of the GRI’s Sustainability Reporting Guidelines Vol. 3.0 (pages 7–17).

Supplementary Notes – Recommendations

Without prejudice to our audit fi ndings outlined above, we make the following recommendations on further development of CSR management and CSR reporting:

p Further implementation of the CSR Strategy and continuous reporting on the articulated CSR goals as well as progress made toward the ultimate goal: the derivation of the overall goals in a comprehensive CSR program that covers the essential spheres of activity. p Development of systematic and documented

internal control procedures for explaining and annotating changes on a central level as well as the level of individual businesses and business streams. p Further formalizing and ensuring the consis-

tent international adoption of defi nitions for all key fi gures for CSR.

Düsseldorf, March 18, 2013

Auditing fi rm PricewaterhouseCoopers

Hendrik FinkAuditor

pp Aissata TouréAuditor

Responsibility

Verification Statement 143


TÜV Rheinland presents its third integrated Corporate Report. The report is based on the internationally recognized IFRS and Global Re-porting Initiative (GRI) reporting standards, the principles of the Global Compact, and the anticorruption guidelines of the UN and Trans-parency International. It takes into account the Group companies included in the consolidated fi nancial statements. The current GRI Guideline (G3) dated October 2006 comprises over 120 in-dicators that describe both the company and its output and the report itself. Furthermore, this report is in accordance with the COP Advanced Level of the UN Global Compact.

The GRI Content Index lists the indicators in the current GRI Guideline that were raised in TÜV Rheinland’s 2012 Corporate Report.

The previous Corporate Report was published in April 2012 and the annual publication frequen-cy is to be maintained in the future.

METHODOLOGY USED IN THE REPORT

The reporting period is the business year 2012. If, at the time of publication (deadline: March 19, 2013), the fi nal fi gures for 2012 were not yet available, comparable annual figures for 2011 have been used as the basis.

ENVIRONMENTAL INDICATORS

Germany:

Of the more than 300 properties in Germany, only office locations with 20 or more employ-ees were covered in the past year, as were mo-tor vehicle testing centers with more than three employees. That led to a total of approximately 80 sites and approximately 80% of the employ-ees in Germany were considered. For 2012, data collection has been limited to 29 essential sites, while still covering 68% of the employees. Nev-ertheless this results in a few deviations in the specifi c consumption data, as test and laborato-ry sites receive a higher weight in the collective being considered. The data collected was then

projected for the entire workforce in Germany and the fi gures were rounded up or down. Other bases of calculation are stated separately. Several figures were newly aggregated and calculated with average fi gures for the year. Although some details are lost in the process, it nonetheless per-mits reliable long-term comparisons and goals to be formulated; estimates and assumptions are identifi ed as such.

International Companies:

To achieve a global coverage of key figures for environmental protection, data was collected from all seven TÜV Rheinland regions. Each of the international companies that has an envi-ronmental or an occupational health and safety management system or that has more than 50 employees was considered at the company level. This covered 60–80% of the employees in inter-national companies to a large extent. The data collected was then projected for the entire work-force in international companies and the fi gures were rounded up or down. Other bases of calcu-lation are stated separately. Data for economic factors and personnel information cover all of the Group’s consolidated companies.

KEY EMPLOYEE FIGURES

If not marked as full-time equivalent (FTE) num-bers, details concerning employee structure are based on numbers of employees. Both refer to the cutoff date fi gures (December 31, 2012) un-less otherwise indicated. The coverage of infor-mation on the structure of the workforce ac-cording to age and gender in the international companies is over 90%.

The present TÜV Rheinland Sustainability Re-port takes full account of the Global Reporting Initiative’s (GRI) reporting framework. The re-port corresponds to the highest GRI application level (Application Level A+), as confi rmed by the GRI in the course of an inspection. The fi gures stated in the report were audited by Pricewater-houseCoopers subject to the limitations stated in the inspection certifi cate.

ABOUT THIS REPORT

144


GRI INDEX

GRI-IndexUN Global Compact/Transparency International Reporting Guidance on Anticorruption

Indicators

Corporate

Report and Web

References Comments

UNGC-

Prin-

ciples-

1 Strategy and Analysis

1.1 Statements from the most senior decision makers pp 2 – 3

1.2 Description of key impacts, risks, and opportunities pp 42, 61, 63,

93–95

2 Organizational Profile

2.1 Name of the organization TÜV Rheinland AG

2.2 Primary services Reportagen,

pp 84–89

www.tuv.com

2.3 Operational structure, including main divisions pp 136–139, 152

2.4 Location of organization’s headquarters Am Grauen Stein, 51105 Cologne, Germany

2.5 Names of countries with major operations pp 77–79

2.6 Nature of ownership and legal form p 104

2.7 Markets served pp 79–81

www.tuv.com

2.8 Scale of the reporting organization pp 79, 89

2.9 Significant changes regarding size, structure or ownership p 144

2.10 Awards received in the reporting period p 50

3 Report Parameters and Limits

3.1 Reporting period p 144

3.2 Date of most recent previous report p 144

3.3 Reporting cycle p 144

3.4 Contact point for questions regarding the report

or its contents

Impressum,

www.tuv.com/

nachhaltigkeit

3.5 Process for defining report content p 144 Topics that are defined as essential are introduced on pages 44

and 45. They are the basis for this report.

3.6 Boundaries of the report p 144

3.7 Limitations on the scope of the report p 144

3.8 Basis for reporting on joint ventures, subsidiaries, and

other entities

p 144

3.9 Data measurement techniques and bases of calculations p 144

3.10 Re-statements of information provided in earlier reports p 144

3.11 Significant changes from previous reporting periods in

the scope, boundary, or measurement methods applied

in the report

p 144

3.12 GRI content index p 145 –150

3.13 External assurance for the report p 142–143

4 Governance, Commitments, and Engagement

4.1 Governance structure and responsibility for sustainability p 42–43, 48 1–10

4.2 Independence of the Chair of the highest governance body In accordance with German law, the tasks of the Chief Executive

Officer and the Supervisory Board chairman are strictly sepa-

rate and distinct from one another.

1–10

4.3 Details of organizations that have no unitary board structure In accordance with the German Companies Act, TÜV Rheinland

has a dual management system consisting of an Executive

Board and a Supervisory Board.

1–10

4.4 Mechanisms for shareholders and employees to provide

recommendations or direction to the highest governance body

p 52, 55 In accordance with Germany’s Work Constitution Act, the

employees are represented by staff representatives on the

Supervisory and Management Boards.

1–10

4.5 Linkage between compensation for members of the highest

governance body and the organization’s sustainability

performance

Sustainability is an integral part of our business model. A more

detailed consideration of social and ecological aspects with

regard to the variable salary components does not exist.

1–10

* Additional indicator Fully reported Partially reported Not reported

Responsibility

GRI Index 145


Indicators

Corporate

Report and Web

References Comments

UNGC-

Prin-

ciples-

4.6 Processes in place to ensure conflicts of interest are avoided Consulting services and auditing services are kept separate

within our organization to prevent conflicts of interest. Further-

more, the Guideline for the Prevention of Conflicts of Interests

and Corruption are part of the compliance system.

1–10

4.7 Qualifications and expertise of the members of the highest

governance body concerning sustainability

www.tuv.com/de/

deutschland/ueber_

uns/ueber_uns.jsp

Because sustainability is an integral part of our business model,

these requirements are integrated into the general selection

processes.

1–10

4.8 Internally developed statements of mission or values

and codes of conduct

pp 43, 47 – 48, 50 1–10

4.9 Procedures of the highest governance body for overseeing the

organization’s management of economic, environmental, and

social opportunities and risks

pp 47 – 48 1–10

4.10 Processes for evaluating the highest governance body’s own

environmental performance

Because sustainability is an integral part of our business model,

no specific procedures for sustainability performance assess-

ment are used.

4.11 Implementation of the precautionary approach pp 42 – 43 7

4.12 Externally developed initiatives to which the organization

subscribes or endorses

pp 43, 46 1–10

4.13 Memberships in associations pp 46 – 47 1–10

4.14 List of stakeholder groups engaged by the organization p 44

4.15 Basis for identification and selection of stakeholders

with whom to engage

p 44

4.16 Approaches to stakeholder engagement pp 44 – 45

4.17 Response to key topics and concerns of the stakeholders p 45

Economic

Economic Performance Indicators

Management Approach pp 42, 65, 69,

74–104

1, 4, 6, 7

EC 1 Direct economic value generated and distributed pp 84, 98, 102

EC 2 Financial implications and other risks and opportunities

of climate change

pp 92–93 The business risks and opportunities with regard to climate

change are indicated, but they cannot be precisely quantified.

7

EC 3 Coverage of the organization’s defined benefit plan obligations p 114

EC 4 Significant financial assistance received from government In the consideration of the grand total of revenue, financial

contributions from the government are not significant.

EC 5* Range of ratios of standard entry-level wage compared to

local minimum wage

Because our employees are all highly educated, we set our

wage systems above the legal minimums.

1

EC 6 Policy, practices, and proportion of spending on locally-based

suppliers

As a service provider, purchasing products is less relevant and

primarily concerns office supplies.

EC 7 Procedures for local hiring By the same standard, our international locations favor local

personnel. This also applies to management positions.

6

EC 8 Infrastructure investments and services provided primarily

for public benefit

p 67 – 71

EC 9* Significant indirect economic impacts p 67 – 71

Environmental Performance Indicators

Management Approach pp 45, 47, 61, 63,

65, 66, 68

7, 8, 9

EN 1 Materials used by weight or volume p 64 Unlike manufacturing companies, as a service provider we only

use consumable materials; for the most part paper.

8

EN 2 Percentage of materials used that are recycled input materials Unlike manufacturing companies, we only use consumable

materials as a service provider. Therefore, the indicator is not

material for our business activities. In our electronic ordering

catalog, however, we explicitly refer to recycled products so

that they may be considered in purchasing.

8–9

EN 3 Direct energy consumption by primary energy source pp 62 – 66 We comprehensively report on direct energy consumption ac-

cording to primary energy sources in the units relevant for the

TÜV Rheinland Group. An exposition in joules is not considered

productive for the internal management.

8

EN 4 Indirect energy consumption by primary energy source pp 62 – 64 We comprehensively report on indirect energy consumption ac-

cording to primary energy sources in the units relevant for the

TÜV Rheinland Group. An exposition in joules is not considered

productive for the internal management.

8


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EN 5* Energy saved due to conservation and efficiency

improvements

pp 65, 68 8–9

EN 6* Initiatives to provide energy-efficient or renewable

energy-based products and services

pp 65 – 66 8–9

EN 7* Initiatives to reduce indirect energy consumption and

reductions achieved

p 63 8–9

EN 8 Total water withdrawal by source pp 63 – 64 8

EN 9* Water sources significantly affected by withdrawal of water p 64 8

EN 10* Percentage and total volume of water recycled and reused Our wastewater discharge corresponds to the previously used

drinking water from the communal network. Moreover, no ad-

ditional wastewater is created. The wastewater discharge goes

through communal canal systems and is directed to the usual

processing.

8–9

EN 11 Land in, or adjacent to, protected areas. All land at our German locations is adjacent to utilizable or

green spaces. They are treated as gardens but are not consid-

ered protected or restored habitats.

8

EN 12 Significant impacts of services on biodiversity As a service provider, we do not create pollution in the way that

traditional manufacturing companies do; thus, our proper-

ties do not harm the environment any more than other urban

development areas.

8

EN 13* Habitats protected or restored All land at our German locations is adjacent to utilizable or

green spaces. They are treated as gardens but are not consid-

ered protected or restored habitats.

8

EN 14* Strategies, current actions, and future plans for managing

impacts on biodiversity

As a service provider, this is not a significant issue for us. 8

EN 15* Conservation list species with habitats affected by services All of our German properties are in urban areas where, to the

best of our knowledge, no endangered species currently live.

8

EN 16 Total direct and indirect greenhouse gas emissions by weight pp 62 – 63 8

EN 17 Other relevant indirect greenhouse gas emissions by weight Our business activities produce only CO2 emissions but no

other relevant air emissions.

8

EN 18* Initiatives to reduce greenhouse gas emissions pp 63 – 64 For some initiatives, the direct emissions savings cannot yet be

quantified.

7–9

EN 19 Emissions of ozone-depleting substances by type and weight The cooling systems are state of the art and operate without

CFCs. Due to considerations of relevance, only CO2 emissions

are examined in the report.

8

EN 20 NOx, SOx, and other significant air emissions by type and

weight

Due to considerations of relevance, only CO2 emissions are

examined in the report.

8

EN 21 Total water discharge by quality and destination Our wastewater discharge corresponds to the previously used

drinking water from the communal network. Moreover, no ad-

ditional wastewater is created. The wastewater discharge goes

through communal canal systems and is directed to the usual

processing.

8

EN 22 Total weight of waste by type and disposal method pp 66 – 67 8

EN 23 Total number and volume of significant spills There were no significant spills in the reporting year. 8

EN 24* Waste deemed hazardous under the terms of the Basel

Convention

pp 66 – 67 8

EN 25* Effects of discharges of water on ecosystems We do not conduct any wastewater into natural bodies of

water. We currentlly do not collect data on rainwater channeled

through sealed areas.

8

EN 26 Initiatives to mitigate environmental impacts of services p 68 7–9

EN 27 Percentage of products sold and their packaging materials that

are reclaimed by category

As a service provider, we do not need packaging for our

products. Our packaging materials are limited to the postal

envelopes, etc. that we use to send our inspection reports in.

Our customers can dispose of these in wastepaper bins to have

them recycled.

8–9

EN 28 Fines for noncompliance with environmental laws and

regulations

We are not aware of any such breaches across the entire Group

in the reporting year.

8

EN 29* Significant environmental impacts from transport p 65 8

EN 30* Total environmental protection expenditures p 63 7–9

Responsibility

GRI Index 147


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Labor Practices and Employment

Management Approach pp 50 – 52, 61 1, 3, 6

LA 1 Total workforce by employment type, employment contract,

and region

pp 53–54

LA 2 Total number and rate of employee turnover by age group,

gender, and region

In the reporting year 2012 in Germany, 230 male employees and

163 female employees left the company (incl. retirement, expira-

tion of contract, etc.). Our newly hired employees in Germany

were predominantly between 30 and 50 years old.

More detailed reporting is currently not possible because

appropriate data will only become available through gradual

unification of the personnel systems.

6

LA 3* Benefits provided to full-time employees p 114 In addition to actual basic compensation, we provide ad-

ditional payments in a number of our German companies,

predominantly based on collective bargaining. These include a

Christmas bonus, holiday pay, and capital-forming payments.

Other payments, such as a company pension plan, disability in-

surance, and Group accident insurance, are granted throughout

the company based on consolidated agreements.

LA 4 Percentage of employees covered by collective bargaining

agreements

The compensation for about 65% of our employees in Germany

is subject to a collective bargaining agreement.

1, 3

LA 5 Minimum notice periods regarding significant operational

changes

On the basis of legal regulations (Sections 111, 112 Works

Constitution Act), the responsible works council is notified com-

prehensively and in a timely manner of planned organizational

changes that could result in significant disadvantages to the

workforce or substantial parts of the workforce. The planned or-

ganizational changes are discussed with the works council. The

minimum notice period for operational changes is four weeks.

3

LA 6* Percentage of total workforce represented in formal joint

management-worker health and safety committees

p 60 1

LA 7 Rates of injury, occupational diseases, lost days, and

absenteeism, and number of work-related fatalities

p 60 In the reporting year, no occupational diseases were reported

in Germany.

1

LA 8 Measures in place to provide assistance regarding serious

diseases

p 59 1

LA 9* Health and safety topics covered in formal agreements with

trade unions

pp 60 – 61 1

LA 10 Average hours of training per year per employee

by employee category

pp 56 – 57

LA 11* Programs for skills management and lifelong learning pp 53

LA 12* Percentage of employees receiving regular performance and

career development reviews

pp 55

LA 13 Composition of governance bodies and breakdown of employ-

ees per category according to gender, age group, and minority

group membership

pp 53 – 54 1, 6

LA 14 Ratio of basic salary of women to men by employee category At TÜV Rheinland, an employee’s wage is oriented on the

employee’s work activities, qualifications, and professional

experience.

1, 6

Human Rights

Management Approach pp 47 – 49 1–6

HR 1 Investment agreements that include human rights clauses or

that have undergone human rights screening

In the reporting year, we have not become aware of any invest-

ment agreements that include human rights clauses or that have

undergone human rights screening.

1–6

HR 2 Percentage of suppliers and contractors that have undergone

screening on human rights

All suppliers sign our general purchasing terms and conditions,

which obligate them to respect human rights. There is no

separate screening. If a supplier violates the rules, we reserve

the right of an extraordinary termination of contractual agree-

ments.

1–6

HR 3* Employee training on policies and procedures concerning

human r ights

p 49 Not significant. Because it is an e-learning program, the pro-

cessing and training time depends on the user.

1–6

HR 4 Incidents of discrimination and actions taken No cases of discrimination in Germany were reported during the

reporting year.

1–2, 6


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HR 5 Operations identified in which the right to exercise freedom

of association or collective bargaining may be at risk

In all of our companies, employees’ right to establish or partici-

pate in organizations is permitted in accordance with local laws.

1–3

HR 6 Principles and measures taken to contribute to the elimination

of child labor

Due to the nature of our business activities, there is no com-

pliance risk with regard to child labor or forced labor in the

performance of our activities. Nonetheless, the prohibition on

child labor and forced labor is an integral part of our guidelines

and a regular subject of compliance trainings.

1–2, 5

HR 7 Principles and measures taken to contribute to the elimination

of forced or compulsory labor

Due to the nature of our business activities, there is no com-

pliance risk with regard to child labor or forced labor in the

performance of our activities. Nonetheless, the prohibition on

child labor and forced labor is an integral part of our guidelines

and a regular subject of compliance trainings.

1–2, 4

HR 8* Security personnel training concerning human rights Not relevant. Security forces employed at TÜV Rheinland are

familiarized with human rights issues as part of an obligatory

compliance training session. External security personnel are

currently not seen as a risk group requiring special focus.

HR 9* Incidents involving rights of indigenous people and actions

taken

Due to our business activities, the limitation of the rights of

indigenous people do not represent a risk.

Society

Management Approach pp 47, 49, 69 10

SO 1 Programs that assess the impacts of operations on

communities

pp 58, 69 – 71 TÜV Rheinland keeps a record of the effects of its actions on

the environment. We can measure our development using key

figures. Due to our business activities, the effect on the com-

munity (e.g. with regard to health and safety aspects) is low.

Therefore, we also have no programs or systematic procedural

method to assess and regulate the effects of business activities

on the local communities.

SO 2 Business units analyzed for risks related to corruption pp 48–49 10

SO 3 Employee training in anti-corruption policies p 49 10

SO 4 Actions taken in response to incidents of corruption p 49 10

SO 5 Public policy positions and participation in public policy devel-

opment and lobbying

We hold positions as experts on various national and interna-

tional committees; however, we neither take a political position

nor support political parties.

1–10

SO 6* Total value of financial and in-kind contributions to political

parties and politicians

As in previous years, we did not support any political parties

in 2012.

10

SO 7* Legal actions for anti-competitive behavior We conform with anti-competitive regulations and no legal

actions have been taken against us in this regard.

SO 8 Fines for noncompliance with laws and regulations p 49

Product Responsibility

Management Approach pp 46 – 47, 68 1, 8

PR 1 Life cycle stages in which health and safety impacts of prod-

ucts are assessed

p 68 1

PR 2* Incidents of non-compliance with regulations and voluntary

codes concerning health and safety impacts

p 68 1

PR 3 Type of product information required by procedures p 68 8

PR 4* Incidents of non-compliance with regulations and voluntary

codes concerning product and service labeling

p 68 8

PR 5* Customer satisfaction, including results of surveys pp 67–68

PR 6 Programs for adherence to laws, standards, and voluntary

codes related to marketing communications

Our marketing policy follows the fairness principle. We not

only adhere to the IFIA’s code in this regard, but have also

formulated corresponding rules in our company’s own Code of

Conduct.

PR 7* Total number of incidents of non-compliance with regulations

and voluntary codes concerning marketing communications

We have also not become aware of any fines in the reporting

year 2012 for unfair competition or competition-related viola-

tions.

PR 8* Total number of substantiated complaints regarding

breaches of customer privacy and losses of customer data

p 68 There were no legitimate complaints relevant to breaches of

customer privacy or losses of customer data during the period

during the period.

1

PR 9 Fines for non-compliance with laws and regulations concern-

ing the provision and use of products and services

No significant fines for noncompliance with laws concerning

the provision and use of products and services were issued.

Responsibility

GRI Index 149


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UNGC/TI Reporting Guidance on Anti-Corruption

Commitment and Policy

B 1 Publicly stated commitment to work against corruption p 47

B 2 Commitment to be in compliance with all anti-corruption laws p 47

D 1 Publicly stated formal policy of zero tolerance for corruption p 47

D 2 Statement of support for international and regional legal

frameworks, such as the UN Convention against Corruption

p 47

D 3 Carrying out risk assessment of potential areas of corruption pp 48 – 49

D 4 Detailed policies for high-risk areas of corruption pp 47 – 48

D 5 Policy on anti-corruption regarding business partners p 48

Implementation

B 3 Translation of anti-corruption commitment into actions pp 48 – 49

B 4 Support by the organization’s leadership for anticorruption pp 3, 48

B 5 Communication and training on the anti-corruption

commitment for all employees

p 49

B 6 Internal checks and balances to ensure consistency with the

anti-corruption commitment

p 48

D 6 Communication and other actions taken to encourage business

partners to implement anti-corruption commitments

p 48

D 7 Management responsibility and accountability for

implementation of the anti-corruption measures or policy

p 48

D 8 Human resources procedures supporting the anti-corruption

measures or policy

pp 48 – 49

D 9 Communications channels (whistle-blowing) and follow-up

mechanisms for possible reporting of concerns or seeking

advice

p 49

D 10 Internal accounting and auditing procedures related to

anti-corruption

pp 48 – 49

D 11 Participation in voluntary anti-corruption initiatives p 47

Monitoring

B 7 Monitoring and improvement processes pp 48 – 49

D 12 Review of monitoring and improvement processes by the

management

pp 48 – 49

D 13 Dealing with incidents p 49

D 14 Public legal cases regarding corruption p 49

D 15 Use of independent external assurance of anti-corruption

programs

p 49


150


2


151

Responsibility

GRI Index

In 2012, approximately 2,000 of our 17,218 global employees

were employed at our headquarters in Cologne.



Products

Ulrich Fietz

Life Care

Industrial Services


Mobility

Siegfried Schmauder


Michael Weppler

Systems

Industrial Services


Mobility

Volker Klosowski

Systems



Andreas Höfer


South America

Gerhard Lübken

North America

Western Europe

Dr. Manfred Doerges

Asia Pacific



Ralf Scheller

Greater China



at TÜV Rheinland:


Siegfried Schmauder


Jörg Mähler

Products





Machine Technology


Building Technology


Services




Supervision

INDUSTRIAL SERVICES


Safety


Management


LIFE CARE


Management Systems


SYSTEMS


� Schools






Management



� Softlines

� Hardlines

� Electrical

� Commercial

� Medical


� Food

PRODUCTS


Inspection




� Rail


Systems

� Aviation

� Maritime

MOBILITY




Closer


CLOSER



Products

Ulrich Fietz

Life Care

Industrial Services


Mobility

Siegfried Schmauder


Michael Weppler

Systems

Industrial Services


Mobility

Volker Klosowski

Systems



Andreas Höfer


South America

Gerhard Lübken

North America

Western Europe

Dr. Manfred Doerges

Asia Pacific



Ralf Scheller

Greater China



at TÜV Rheinland:


Siegfried Schmauder


Jörg Mähler

Products





Machine Technology


Building Technology


Services




Supervision

INDUSTRIAL SERVICES


Safety


Management


LIFE CARE


Management Systems


SYSTEMS


� Schools






Management



� Softlines

� Hardlines

� Electrical

� Commercial

� Medical


� Food

PRODUCTS


Inspection




� Rail


Systems

� Aviation

� Maritime

MOBILITY




Closer


CLOSER

Responsibility

40 CSR Report

142 Verification Statement

144 About this Report

145 GRI Index

Closer

6 Visual Essay

22 Reports

TÜV Rheinland

3 Foreword by the


4 Foreword by the

Supervisory Board

Chairmann

Financial Report

73 Detailed Index

74 Group Management

Report

98 Consolidated


140 Audit Opinion

Service

141 Corporate Bodies

152 Group Structure

Contact

Imprint

By intelligently combining organic growth and acquisitions, we are consolidating our position as the »most international« TÜV and, in doing so, are strengthening the relationships with our globally active customers. Pages 22– 27

As a consumer protection authority, we advocate quality and transparency in the global world of products and services. With our new test mark, we strengthen the confi dence of users in our services. Pages 28–33

We are meeting the major technological challenges of our time with expertise and innovative spirit and, in doing so, secure the sustainability of companies and society. Pages 34 – 39

The Group Executive Council is TÜV Rheinland AG’s highest operational management team be-low the Executive Board. It is composed of TÜV Rheinland AG’s Executive Board, Executive Vice Presidents, Chief Regional Officers, and the Heads of German Operations.

The TÜV Rheinland Group comprises more than 120 companies. The operational parent company is TÜV Rheinland, the shares of which are en-tirely in the possession of TÜV Rheinland Berlin Brandenburg Pfalz e. V.

In accordance with Germany’s Work Constitu-tion Act, the employees are represented by staff representatives on the Supervisory and Manage-ment Boards.

152

Clo

ser

TÜV Rheinland AG

Am Grauen Stein


www.tuv.com













in € millions 2008 2009 2010 2011 2012

Revenues


Mobility 289 295 311 336 366

Products 241 301 350 372 396

Life Care 59 64 55 51 55


Systems 117 116 123 127 118


Profit margin (in %) 8.3 7.8 8.6 8.8 7.4






Co

rpo

rate

Rep

ort

2012

Clo

ser

TÜV Rheinland AG

Am Grauen Stein


www.tuv.com













in € millions 2008 2009 2010 2011 2012

Revenues


Mobility 289 295 311 336 366

Products 241 301 350 372 396

Life Care 59 64 55 51 55


Systems 117 116 123 127 118


Profit margin (in %) 8.3 7.8 8.6 8.8 7.4






Co

rpo

rate

Rep

ort

2012

Documents

TÜV RHEINLAND AG GROUP FIGURES EDITORIAL INFORMATION · 2020-07-12 · Siegfried Schmauder Training and Consutingl Jörg Mähler Products Since its founding in 1872, TÜV Rheinland